Accounts Receivables Turnover is a measure of a company’s ability to efficiently collect payments due from its customers. It is calculated by dividing net credit sales for the period by the average accounts receivable balance. It indicates how many times per year a business can cycle through its unpaid invoices and is an important indicator of a company’s financial health. High turnover means effective management of accounts receivables and indicates good customer payment habits, while low turnover suggests poor management or slow customer payments.