ContentWhy Payment Terms Are ImportantAccounts Receivable Has A Normal Balance Of 1000Manage Your BusinessUsing The Normal Balance
Why Payment Terms Are Important
To use the information, they will want to know accounts receivable turnover, or how often you are collecting the value of your accounts receivable. To calculate AR turnover, you need to start by finding average accounts receivable. If a company sells on credit, customers will occasionally be unable to pay, in which case the seller should charge the account receivable to expense as a bad debt.
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