Receivables Turnover Ratio calculator
Receivables Turnover Ratio is one of the efficiency ratios and measures the number of times receivables are collected, on average, during the fiscal year. This ratio is used together with Average Collection Period. Receivables Turnover Ratio formula is:
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Interpretation of Receivables Turnover Ratio
Receivables turnover ratio measures company's efficiency in collecting its sales on credit and collection policies. » more on interpretation of Receivables Turnover Ratio
Definitions and terms used in the Receivables Turnover Ratio calculator
- Annual credit sales: the amount of revenue generated by a company after the deduction of returns, allowances for damaged or missing goods and any discounts allowed and sold on credit
- Receivables: money owed to a company by customers (individuals or corporations) for goods or services that have been delivered or used, but not yet paid for. In it is also known as Sales on credit.
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