The measure of a company's ability to collect cash from its customers who purchase on account is the A. accounts payable turnov

Question

Lubov Fominskaja [6]

3 years ago

6

The measure of a company's ability to collect cash from its customers who purchase on account is the A. accounts payable turnov

er. B. cash conversion cycle. C. days' payable outstanding. D. accounts receivable turnover.

Business

1 answer:

BigorU [14] · Answer 1 · 2022-01-13T23:00:05+03:00

Answer:

D. accounts receivable turnover.

Explanation:

Accounts receivable turnover is the a financial indicator that shows the number of times that an entity collects its average accounts receivable in a year. It is used to assess the company's to ability to makes sales on account to its customers and collect payments from them timely.

It is calculated as

Accounts receivables turnover

= Net Annual Credit Sales / ((Beginning Accounts Receivable + Ending Accounts Receivable) / 2)

The measure of a​ company's ability to collect cash from its customers who purchase on account is the A. accounts payable turnov

The measure of a company's ability to collect cash from its customers who purchase on account is the A. accounts payable turnov