Which ratio measures the number of times the receivables are rotated in a
year in terms of sales?
Answers
Answer:
Debtors turnover ratio
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Answer:
Which ratio measures the number of times the receivables are rotated in a
year in terms of sales is Debtors turnover ratio
Explanation:
Debtors' turnover ratio:
Net Credit Sales/Average Account Receivable equals the debtor turnover ratio. Where Trade Debtors and Bill Receivables are included in Average Account Receivable. The firm's credit management is better when the debtor turnover ratio is higher.
the formula of debtor's turnover ratio:
Ideally, a firm analyses its debtor's turnover ratio with businesses in the same industry that is similar in size, revenue, and business processes. Debtors Turnover Ratio calculation formula: Net Credit Sales/Average Account Receivable = Debtors Turnover Ratio