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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.

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