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Parker Hardware Store had net credit sales of $8,000,000 and cost of goods sold of $5,000,000 for the year. The Accounts Receivable balances at the beginning and end of the year were $600,000 and $700,000, respectively. The receivables turnover was

Respuesta :

Answer:

12.3076

Explanation:

Receivables Turnover = [tex]\frac{Net\: Credit\: Sales}{Average\: Receivables}[/tex]

Here Net Credit sales = $8,000,000

Average Receivables = [tex]\frac{Beginning\: Receivables + Closing\:Receivables}{2}[/tex]

Opening Receivables = $600,000

Closing Receivables = $700,000

Average Receivables = [tex]\frac{600,000 + 700,000}{2} = 650,000[/tex]

Receivables Turnover = [tex]\frac{8,000,000}{650,000} = 12.3076[/tex]

12.3076

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