contestada

The following information is from the annual financial statements of Raheem Company. 2013 2012 2011 Net sales $405,140 $335,280 $388,000 Accounts receivable, net (year-end) 44,800 41,400 34,800Compute its accounts receivable turnover for 2012 and 2013.

Respuesta :

waseemanis1

Answer:

2013: 9.4x  2012: 8.8x

Explanation:

Account receivable turnover denotes the number of times a Company is able to recover its receivables. Looking bigger picture, accounts receivable turnover is a part of working capital cycle assessment that indicates number of times a company is able to run its business cycle in a given year.

Calculation of Accounts Receivable Turnover

Turnover = Sales / Average balance of trade receivables*

Average balance of trade receivables = (Closing Balance + Opening Balance) / 2.

2013: 405,140 / {(44,800 + 41,400)/2} = 9.4x

2012: 335,280 / {(41,400 + 34,800)/2} = 8.8x

Otras preguntas