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The measure of a​ company's ability to collect cash from its customers who purchase on account is the A. accounts payable turnover. B. cash conversion cycle. C. ​days' payable outstanding. D. accounts receivable turnover.

Answer :

Answer:

D. accounts receivable turnover.

Explanation:

Accounts receivable turnover is the a financial indicator that shows the number of times that an entity collects its average accounts receivable in a year. It is used to assess the company's to ability to makes sales on account to its customers and collect payments from them timely.

It is calculated as

Accounts receivables turnover

= Net Annual Credit Sales / ((Beginning Accounts Receivable + Ending Accounts Receivable) / 2)

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