Receivables turnover ratio

Receivables turnover ratio is one of the indicators of activity,  which shows how many times during the period (year) is a unit of receivable converted into sales.

Calculation formula

Trade receivables are often the average from the beginning and final balance.

Interpretation and appropriate comparatives

can be easily derived from the text presented within the indicator of Receivables collection period, because Receivables turnover ratio can be calculated by dividing the number of days in the year (365) by the formula of Receivables collection period.