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Accounts Receivable Turnover
07-28-2010, 06:53 AM,
 4MySanity Junior Member Posts: 2 Threads: 2 Joined: Jul 2010 Reputation: 0
Accounts Receivable Turnover
I have a pretty basic question for most of you...

I'm having trouble understanding how to get the Accounts Receivable Turnover. I understand it is calculated by NET-Sales/Accounts Receivable or Net-Sales/Accounts Receivable & Short-Term Notes Receivable, but my problem does not seem to be working out. I know the answer to the problem, but I cant seem to arrive at the same solution the exercise gives. Here is the problem if anyone wants to take a look, the answer apparently is 15.93

Sales 889700
COGS <u>508100</u>
Profit 381600
Operating Exp. <u>145300</u>
Operating Income 236300
Interest Exp <u>3500</u>
Income Before Tax 232800
Income Taxes <u>80400</u>
Net Income 153400
---------------------------------

Cash 8200
Temp Investments 28000
A/R, net 52900
Inventory 23900
Prepaid Expenses 4900
Notes Receivable 9500
Plant, assets <u>492000</u>
Total Assets 619400

I get 16.81 (
08-04-2010, 03:25 AM,
 Information Consultant Senior Member Posts: 311 Threads: 42 Joined: Jul 2010 Reputation: 0

What is the answer pls tell me
09-01-2010, 06:21 AM,
 Mobi Junior Member Posts: 1 Threads: 0 Joined: Sep 2010 Reputation: 0

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Information Consultant</i>
<br />What is the answer pls tell me
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

both ansers r rong. d corect is as

net sales/(net rcvabls + nots recvables) = Rcvabl turnover in times

889700/(52900+492000) = 1.62 times

n if u want to turnover in days so u wil get by

365/in times OR (net rcvabls + nots rcvabls)/net sales x 365

365/1.62 = 223 days

09-17-2010, 10:45 PM,
 blue sun Junior Member Posts: 11 Threads: 3 Joined: Aug 2010 Reputation: 0

10-01-2010, 07:34 PM,
 Arabian Junior Member Posts: 20 Threads: 9 Joined: Feb 2009 Reputation: 0

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by 4MySanity</i>
<br />I have a pretty basic question for most of you...

I'm having trouble understanding how to get the Accounts Receivable Turnover. I understand it is calculated by NET-Sales/Accounts Receivable or Net-Sales/Accounts Receivable & Short-Term Notes Receivable, but my problem does not seem to be working out. I know the answer to the problem, but I cant seem to arrive at the same solution the exercise gives. Here is the problem if anyone wants to take a look, the answer apparently is 15.93

Sales 889700
COGS <u>508100</u>
Profit 381600
Operating Exp. <u>145300</u>
Operating Income 236300
Interest Exp <u>3500</u>
Income Before Tax 232800
Income Taxes <u>80400</u>
Net Income 153400
---------------------------------

Cash 8200
Temp Investments 28000
A/R, net 52900
Inventory 23900
Prepaid Expenses 4900
Notes Receivable 9500
Plant, assets <u>492000</u>
Total Assets 619400

I get 16.81 (
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

Is this a full question or Extract from the question,There should be some Opening bal for A/c Recieveables, because formula for A/C Rec is Net Sales/Avg A/c Recieveables,
10-01-2010, 07:36 PM,
 Arabian Junior Member Posts: 20 Threads: 9 Joined: Feb 2009 Reputation: 0

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Mobi</i>
<br /><blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Information Consultant</i>
<br />What is the answer pls tell me
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

both ansers r rong. d corect is as

net sales/(net rcvabls + nots recvables) = Rcvabl turnover in times

889700/(52900+492000) = 1.62 times

n if u want to turnover in days so u wil get by

365/in times OR (net rcvabls + nots rcvabls)/net sales x 365

365/1.62 = 223 days

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

Mobi Brother You have taken notes recieveable as 492000,which is the amount for Assets,

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