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Receivable turnover ratio or debtor's turnover ratio is an accounting measure used to measure how effective a company is in extending credit as well as collecting debts. The receivables turnover ratio is an activity ratio, measuring how efficiently a firm uses its assets .
Accounts receivable represents money owed by entities to the firm on the sale of products or services on credit. In most business entities, accounts receivable is typically executed by generating an invoice and either mailing or electronically delivering it to the customer, who, in turn, must pay it within an established timeframe, called credit terms [citation needed] or payment terms.
In accounting, the inventory turnover is a measure of the number of times inventory is sold or used in a time period such as a year. It is calculated to see if a business has an excessive inventory in comparison to its sales level. The equation for inventory turnover equals the cost of goods sold divided by the average inventory.
The asset turnover ratio is a valuable financial metric that measures a company’s efficiency in using its assets to generate revenue. By understanding this ratio, you can gain insights into a ...
A good fixed asset turnover ratio depends on the industry, but a ratio of 3:1 or higher is typically considered strong. It shows that a company can earn at least $3 in sales for every $1 spent on ...
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Turnover (employment), relative rate at which an employer gains and loses staff Asset turnover or asset turns, a financial ratio that measures the efficiency of a company's use of its assets in generating sales revenue
Total asset turnover ratios can be used to calculate return on equity (ROE) figures as part of DuPont analysis. [5] As a financial and activity ratio, and as part of DuPont analysis, asset turnover is a part of company fundamental analysis. [6]