Question

CUBE
Which is the correct lever for the BOI 'Ending Total Receivable x No. of Days in period
analyzed/Credit Sales for the period analyzed"?
O Days Sales Outstanding
O Payment Terms Deviation (% AR nonstandard)
o o o
O Past due %
Time to Resolve Disputes

Answer 1

Answer:The term average collection period refers to the amount of time it takes for a business to receive payments owed by its clients in terms of accounts receivable (AR). Companies use the average collection period to make sure they have enough cash on hand to meet their financial obligations.1 The average collection period is an indicator of the effectiveness of a firm’s AR management practices and is an important metric for companies that rely heavily on receivables for their cash flows.