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13 December, 20:29

Axle Co.'s accounts receivable turnover was 9.9 for this year and 11.0 for last year. Betterman's turnover was 9.3 for this year and 9.3 for last year. These results imply that: Multiple Choice Betterman has the better turnover for both years. Axle has the better turnover for both years. Betterman's turnover is improving. Axle's credit policies are too loose. Betterman is collecting its receivables more quickly than Axle in both years.

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  1. 13 December, 22:53
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    Answer: Axle has the better turnover for both years.

    Explanation:

    Accounts Receivable Turnover ratio is used to measure the amount of times in a year that a company is able to collect payment from it's Receivables.

    A higher Accounts Receivable Turnover ratio indicates that the company is doing well in collecting their Receivables and as such are not trying down working capital because it is not be reinvested to put back into the business.

    Axle had a Turnover ratio of 11 last year and a Turnover of 9.9 this year which is better than Betterman in both years. This means that Axle had the best Turnover for both years.
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