Accounting for IGCSE & O level - Advanced Principles (Section 2 - No. 34)
What does it mean to have an accounts receivable turnover ratio of 12?
The company collects its accounts receivable once per year.
The company collects its accounts receivable twelve times per year.
The company has a low level of sales.
The company has a high level of bad debts.
Explanation
This indicates the company collects its receivables 12 times a year.
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