Receivable Turnover

Receivables turnover ratio is a percentage which can be calculated by dividing the net value of credit sales (revenue) during a given period by the average accounts receivable during the same period. It’s an accounting measure used to quantify a firm's effectiveness in extending credit and in collecting debts on that credit. The receivables turnover ratio is an activity ratio measuring how efficiently a firm uses its assets.

Calculated as: (Revenue /Average Account Receivable) x 100