Question

Logan Sales provides the following​ information: Net credit​ sales: $790,000 Beginning net accounts​ receivable: $43,000 Ending net accounts​ receivable: $22,000 Calculate the accounts receivable turnover ratio.​ (Round your answer to the nearest whole​ number.)

Answer 1

24 times

Step-by-step explanation:

The formula to compute the accounts receivable turnover ratio is shown below:

Accounts receivable turnover ratio = Credit sales ÷ average accounts receivable

where,

Average accounts receivable = (Opening balance of Accounts receivable + ending balance of Accounts receivable) ÷ 2

= ($43,000 + $22,000) ÷ 2

= $32,500

And, the net credit sale is $790,000

Now put these values to the above formula

So, the answer would be equal to

= $790,000 ÷ $32,500

= 24 times