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7 May, 19:22

Treadwell Tire Company had net accounts receivable of $67,900 at the beginning of the year and $72,400 at the end of the year. The company's net sales revenue during the year was $876,875. What was the receivables turnover ratio for the year

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  1. 7 May, 19:48
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    12.50

    Explanation:

    Data provided

    Accounts receivable = $67,900

    Beginning of the year = $72,400

    Sales revenue during the year = $876,875

    The computation of the receivables turnover ratio for the year is shown below:-

    Average receivables = (Accounts receivable + Beginning of the year) : 2

    ($67,900 + $72,400) : 2

    = $70,150

    Receivables Turnover ratio = Sales revenue during the year : Average receivables

    = $876,875 : $70,150

    = 12.50
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