CFA Practice Question

There are 534 practice questions for this study session.

CFA Practice Question

Gross sales total $505,000 and sales returns & allowances total $15,000. Average accounts receivable for the period are $42,000. What is the accounts receivable turnover rate?
A. 11.67
B. 12.02
C. 12.38
Explanation: Net sales total $490,000 ($505,000 - $15,000). Net sales divided by the average accounts receivable equals the accounts receivable turnover rate: ($490,000/$42,000) = 11.67.

User Contributed Comments 1

User Comment
farhan92 Net Sales. I chose B as i left out the 15,000!
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