# Accounts Receivable Turnover Calculator

Key in the Nets Sales and Accounts Receivable Values to the respective fields given below and then click Calculate to get the desired result.

##### Accounts Receivable Turnover Ratio Calculator - Glossary:
Using our accounts receivable turnover ratio calculator, helps to compare, measure, understand the overall health of the business.

##### Accounts Receivable Turnover Ratio:
Shows the proportion of Net Sales to Average Account Receivable. In simple words, it helps a company to determine the average time it took to collect its money.

##### How to calculate?
Formula: Accounts Receivable (AR) Turnover Ratio = Net Sales/Average Accounts Receivable.
The values are commonly stated against accounts receivable in the balance and net sales in income statement.
Note:
Average Accounts Receivable (AR) = (Begin Accounts Receivable + Ending Accounts Receivable)/2

##### Net Sales:
Total sales less returns and bad debts.

##### Account Receivable:
Account receivable is balance sheet component - net value of credit sales during a given period.

##### Average Accounts Receivable:
An average value of accounts receivable value at the beginning of the year and accounts receivable value at the end of the year.

##### Example:
Account receivable turnover ratio for a company with a net sales income of \$360,000 and average accounts receivable of \$30,000 is 12 times. It means that an average customer took 30 days to pay the company's credit sales. It is an accounting ratio that helps a company to determine the average time it took to collect its money (AR) by dividing the Asset Turnover Ratio/365days.