Question
From the following details, calculate the accounts
receivable turnover ratio:Â Sales 400,000 Cost of the Goods sold 100,000Â Account Receivable (at the beginning of the year) Rs.60,000 Account Receivable (at the end of the year) Rs.100,000Solution
Accounts receivable turnover ratio = Net Sales/ Average Account Receivables Average Receivables = (60,000+100,000)/2=80,000 Accounts receivable turnover ratio = 400,000/80,000 = 5
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