What is accounts payable turnover? A. Purchases on account divided by average accounts payable B. A measure of the number of times a year a company is able to pay its accounts payable C. A measure of liquidity D. All of the listed answers are correct.

Question

Business

Dangelo Boyer

16 January, 11:38

What is accounts payable turnover? A. Purchases on account divided by average accounts payable B. A measure of the number of times a year a company is able to pay its accounts payable C. A measure of liquidity D. All of the listed answers are correct.

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Answers (1)

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Macy Pearson · Answer 1

The correct answer is letter "D": All of the listed answers are correct.

Explanation:

Accounts Payable Turnover ratio measures the speed at which a company pays its suppliers. The ratio is calculated by dividing the company's total purchases from suppliers by its average accounts payable amount over the same period. The accounts payable turnover ratio measures the liquidity firms have in the short-term.