ACC 400 Course Great Wisdom / tutorialrank.com ACC 400 Course Great Wisdom / tutorialrank.com | Page 10

Accounts

Receivable

10,000

10.

The receivables turnover ratio

a.
Is computed by dividing net credit sales for the accounting
period by the cash realizable value of accounts receivable on the last
day of the accounting period.

b.

Can be used to compute the average collection period.

c.
Is a method of evaluating the solvency of net accounts
receivable.

d.

11.

Is only important to internal users of accounting information.

A measure of a company’s solvency is the

a.

acid-test ratio.

b.

current ratio.