Answer:
6.75
Explanation:
Given that,
Gross sales = $150,000
Accounts receivable, beginning of year = $18,000
Sales = $135,000
Accounts receivable, end of year = $22,000
Average accounts receivables:
= (Beginning AR + Ending AR) ÷ 2
= ($18,000 + $22,000) ÷ 2
= $40,000 ÷ 2
= $20,000
Accounts receivable turnover:
= Sales ÷ Average accounts receivables
= $135,000 ÷ $20,000
= 6.75
Note: Accounts receivable, end of year is missing from the question. It is amounted to $22,000.
