---
title: "Definition of Rec Turn"
url: https://signalscreener.fr/definition/receivables-turnover/
markdown_url: https://signalscreener.fr/definition/receivables-turnover.md
description: "Measures how efficiently a company collects its receivables (money owed by customers)."
type: glossary-definition
site: Signal Screener
language: en
keywords:
  - "Rec Turn"
  - "Receivables Turnover"
translations:
  de: https://signalscreener.fr/de/definition/receivables-turnover.md
  es: https://signalscreener.fr/es/definition/receivables-turnover.md
  fr: https://signalscreener.fr/fr/definition/receivables-turnover.md
---

# Receivables Turnover

## What is Rec Turn?

Measures how efficiently a company collects its receivables (money owed by customers).

## Think of it like this

Like measuring how quickly your friends pay you back after lending them money.

## Formula

```
Receivables Turnover = Revenue ÷ Average Accounts Receivable
```

- **Revenue**: Net credit sales (or total revenue)
- **Average A/R**: (Beginning + Ending Receivables) ÷ 2

## Why it matters

- Shows effectiveness of credit and collection
- Higher = faster collection of payments
- Affects cash flow and working capital
- Can indicate customer financial health

## What's a good value?

| Range | Rating | What it means |
|---|---|---|
| < 5x | Low | Slow collection, potential bad debts |
| 5-10x | Moderate | Average collection efficiency |
| 10-15x | Good | Efficient collection practices |
| > 15x | Excellent | Very fast collection or mostly cash sales |

## Real-world example

Declining receivables turnover may signal customers are struggling to pay or looser credit terms.

---

This is educational content, not financial advice.

Source: [Definition of Rec Turn](https://signalscreener.fr/definition/receivables-turnover/) on Signal Screener. Free to quote and cite with attribution and a link to that URL, which is the canonical one.

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