Boca Raton credit sales are $5,870,000, beginning receivables are $515,000, and ending receivables are $552,000. What accounts receivable turnover is shown?
Correct Answer
C) 11.0 times
Accounts receivable turnover equals credit sales divided by average receivables.
Why This Is the Correct Answer
Accounts receivable turnover equals credit sales divided by average receivables.
Why the Other Options Are Wrong
Option A: 10.6 times
10.6 times is below the supported result for accounts receivable turnover; it likely uses the wrong base, period, or account bucket.
Option B: 11.4 times
11.4 times is above the supported result for accounts receivable turnover; it likely adds an unsupported amount or compares the wrong financial base.
Option D: 0.1 times
0.1 times is below the supported result for accounts receivable turnover; it likely uses the wrong base, period, or account bucket.
Memory Technique
Controller Reviews money test: bucket before math for accounts.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Section One, Managing Receivables, Track Your Receivables Trend; Section Three, Financial Ratios; use the job ledger figures in the stem and recompute the same accounting measure.
More Business & Finance Questions
The Cedar Key subcontract closeout file requires 44 final releases, and 31 have been received. How many releases are missing?
A Florida GC prepaid $18,000 for annual insurance and expenses it evenly by month. After 7 months have expired, what prepaid asset remains?
The West Miami system access list starts with 22 active users, adds 4, and removes 7. How many active users should remain?
The Winter Park bank review shows a bank balance of $124,600, book balance of $119,400, and known timing items of $3,200. What unexplained difference remains?
The Riverview bank review shows a bank balance of $87,500, book balance of $90,400, and known timing items of $1,600. What unexplained difference remains?
A Satellite Beach contractor had 4 separations during the quarter and an average headcount of 32. What turnover rate should HR report?
A Winter Park startup budgets monthly overhead of $61,500 and wants a 4-month operating reserve. What reserve should be funded?
A Royal Palm Beach customer account has unpaid approved invoices of $126,000. Company policy requires review when unpaid invoices exceed $100,000. What status applies?
A Wildwood contractor had 9 separations during the quarter and an average headcount of 60. What turnover rate should HR report?
A Clermont field group had 64 absence hours out of 1280 scheduled hours. What absence rate should be reported?
People Also Study
Related Study Resources
Previous Question
A Mary Esther cost code was budgeted for 9,600 units at $8.25 per unit. Actual cost posted is $82,440. What cost variance should be reported?
Next Question
A Wesley Chapel warehouse issues 185 units using FIFO. The first layer has 110 units at $31.40 and the next layer has 170 units at $33.20. What cost should be charged to the job?