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Ratios: Accounts Receivable (AR) Turnover definitions

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Termini in questo insieme (15)

  • Accounts Receivable Turnover Ratio
    Efficiency metric showing how often average receivables are converted into net credit sales during a period.
  • Net Credit Sales
    Total sales made on credit minus returns and allowances, used as the numerator in turnover calculations.
  • Average Accounts Receivable
    Mean value of receivables, calculated by adding beginning and ending balances and dividing by two.
  • Credit Policy
    Company guidelines determining terms and conditions for extending credit to customers.
  • Benchmarking
    Process of comparing a company's ratio to industry averages or competitors to assess performance.
  • Efficiency Ratio
    Financial metric evaluating how effectively a company manages assets or operations, such as receivables.
  • Credit Terms
    Conditions under which customers are allowed to purchase goods or services on account.
  • Sales Revenue
    Total income from goods or services sold, sometimes used in place of net credit sales if specifics are unavailable.
  • Industry Average
    Standardized value representing typical performance within a specific sector, used for comparison.
  • Abnormally High Turnover
    Situation where receivables are collected very quickly, possibly indicating overly strict credit policies.
  • Receivables Collection
    Process of obtaining payment from customers for credit sales previously made.
  • Beginning Balance
    Amount of accounts receivable at the start of an accounting period, used in average calculations.
  • Ending Balance
    Amount of accounts receivable at the close of an accounting period, used in average calculations.
  • Competitor Comparison
    Assessment of a company's financial ratios against those of similar businesses to gauge relative performance.
  • Credit Extension
    Practice of allowing customers to purchase now and pay later, creating accounts receivable.