Accounts Receivable Turnover (ART) is a financial ratio used to measure how efficiently a company collects on its credit sales or how many times you collect your receivables each year.It's calculated by dividing total sales by the average accounts receivable during a certain period.A higher ART indicates that the company is efficient at collecting its credit, while a lower ratio could mean problems with cash flow or collection processes.The Accounts Receivable Turnover (ART) and Days Sales Outstanding (DSO) are mathematical inverses of each other, here is the formula:
Learn Accounts Receivable Turnover with interactive examples and practice exercises in our Performance Metrics module.
This interactive learning module helps you understand Accounts Receivable Turnover through hands-on practice and real-world examples.