Receivables Turnover Ratio Calculator

Efficiency
Updated Apr 2026 • Has calculator

How many times a company collects its average accounts receivable during a year.

Calculate Receivables Turnover

Receivables Turnover Formula

Receivables Turnover = Revenue ÷ Average Accounts Receivable

Total annual revenue in millions of USD

Average of beginning and ending accounts receivable, in millions of USD

Receivables Turnover

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Not investment advice.

What is Receivables Turnover?

The Receivables Turnover Ratio divides annual revenue by average accounts receivable to show how efficiently a company collects cash from credit customers. A higher ratio means faster collection and better cash flow management; a lower ratio may indicate loose credit policies, slow-paying customers, or collection problems. The reciprocal calculation — Days Sales Outstanding (DSO) — expresses the same concept in days, which is often more intuitive.

Worked Example

Worked example — Apple Inc. (AAPL)

FY2024

Step 1  Revenue FY2024: $391,035M
Step 2  Average accounts receivable: ($33,410M + $29,508M) ÷ 2 = $31,459M
Step 3  Receivables Turnover = $391,035M ÷ $31,459M = 12.43x
Step 4  → Apple collects its average receivable balance roughly every 29 days

Source: Apple 10-K FY2024 (2024-11-01)

How to Interpret Receivables Turnover

< 5
Low — slow collections or lenient credit terms
5 – 10
Average — typical for most industries
10 – 20
High — tight credit policy and efficient collections
> 20
Very High — minimal credit sales or near-cash collections
Sources
  1. CFA Institute — Financial Reporting and Analysis, 6th ed., Ch. 9
  2. Investopedia — Receivables Turnover Ratio