The accounts receivable turnover ratio is an accounting measure used to quantify a company's effectiveness in collecting its receivables or money owed by clients. The ratio shows how well a company uses and manages the credit it extends to customers and how quickly that short-term debt is collected or is paid. A high receivables turnover ratio can indicate that a company’s collection of accounts receivable is efficient and that the company has a high proportion of quality customers that pay their debts quickly. A low receivables turnover ratio might be due to a company having a poor collection process, bad credit policies, or customers that are not financially viable or creditworthy.
Source: Investopedia
Receivables Turnover | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
May 20 | Jun 20 | Jul 20 | Aug 20 | Sep 20 | Oct 20 | Nov 20 | Dec 20 | Jan 21 | Feb 21 | Mar 21 | Apr 21 |
0.20 | 0.20 | 0.20 | 0.40 | 0.20 | 0.10 | 0.30 | 0.30 | 0.10 | 0.20 | 0.20 | 0.20 |
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