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SOFE SOFA-CFE Exam - Topic 9 Question 89 Discussion

Actual exam question for SOFE's SOFA-CFE exam

Question #: 89
Topic #: 9

[All SOFA-CFE Questions]

Collection ratio can be calculated by the formula:

ACollection Ratio = 365 / Payable Turnover

BCollection Ratio = 365 + Net Income / Receivable Turnover

CCollection Ratio = 365 / Receivable Turnover

DCollection Ratio = 365 + Net Sales / Receivable Turnover

Show Suggested Answer

Suggested Answer: A

by Clarinda at Jun 02, 2024, 03:22 PM

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Johnna

7 months ago

Not sure about this, seems too straightforward.

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Arthur

8 months ago

Definitely C! I've used that formula before.

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Brice

8 months ago

Wait, is it really that simple?

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Terrilyn

8 months ago

I thought it was the payable turnover one, but I guess not.

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Stacey

8 months ago

Collection Ratio = 365 / Receivable Turnover is correct!

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Geraldine

9 months ago

I definitely recall that the collection ratio is calculated using receivable turnover, but I can't remember if it's option C or D.

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Justine

9 months ago

I feel like I might be mixing up the terms here. Wasn't there something about net income in one of the practice questions?

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Mariko

9 months ago

I remember practicing a similar question, and I think the correct formula involves dividing 365 by the receivable turnover.

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Camellia

9 months ago

I think the collection ratio is related to receivables, but I'm not sure if it's 365 divided by receivable turnover or something else.

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Davida

9 months ago

I'm a little confused by the different options here. Is the collection ratio just 365 divided by Receivable Turnover, or does it involve other factors like Net Income or Net Sales? I'll have to review my notes to be sure.

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Sharita

9 months ago

Okay, let me think this through. The collection ratio is related to how quickly a company collects on its receivables, so it makes sense that it would involve the Receivable Turnover. I'm going to go with option C.

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Georgiann

9 months ago

Hmm, I'm not sure about this one. I know the collection ratio has to do with receivables, but I can't quite remember the exact formula.

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Erasmo

9 months ago

This looks straightforward, I think the formula is just 365 divided by the Receivable Turnover.

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Fernanda

9 months ago

Hmm, I'm a bit unsure about this one. The question mentions a lot of different responsibilities - establishing, documenting, providing resources, demonstrating commitment. I'll need to think carefully about which role would be responsible for all of those.

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Geoffrey

9 months ago

Option A sounds like it's describing a SOAP-based architecture, where each service has its own contract. Option B seems to be describing a REST-based architecture with a shared uniform contract. I'm pretty confident those are the correct answers.

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Yen

9 months ago

This seems straightforward, I think the answer is A.

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Jacqueline

10 months ago

This question seems straightforward, but I want to make sure I understand the key concepts before selecting an answer.

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Aliza

1 year ago

As an accountant, I'm offended that anyone would think the collection ratio has anything to do with net income or net sales. It's strictly a function of the receivable turnover.

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Jeannine

1 year ago

User 3: So, the correct answer is C) Collection Ratio = 365 / Receivable Turnover.

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Ricki

1 year ago

User 2: I think you're right, it's definitely not related to net income or net sales.

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Elly

1 year ago

User 1: I agree, the collection ratio is calculated by dividing 365 by the receivable turnover.

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Remona

1 year ago

Haha, I almost fell for that one with the 'Net Income' and 'Net Sales' options. But you can't trick me, the collection ratio is all about the receivables!

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Alayna

1 year ago

C) Collection Ratio = 365 / Receivable Turnover

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Arlette

1 year ago

B) Collection Ratio = 365 + Net Income / Receivable Turnover

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Jordan

1 year ago

A) Collection Ratio = 365 / Payable Turnover

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Boris

1 year ago

The formula is Collection Ratio = 365 / Receivable Turnover.

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Leandro

1 year ago

Yeah, it's definitely not about net income or net sales.

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Bernardo

1 year ago

I agree, the collection ratio is calculated using the receivable turnover.

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Deandrea

1 year ago

I initially thought it was A, but then I realized that the payable turnover is not relevant to calculating the collection ratio. The key factor is the receivable turnover.

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Oren

1 year ago

The correct answer is C. The formula to calculate the collection ratio is 365 / Receivable Turnover. This makes sense because the collection ratio represents the average number of days it takes to collect accounts receivable.

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Gaynell

1 year ago

No problem! It's important to understand the formula for calculating collection ratio.

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Ernest

1 year ago

Oh, I see. That makes sense. Thanks for clarifying.

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Johana

1 year ago

Actually, the correct answer is C) Collection Ratio = 365 / Receivable Turnover

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Oretha

1 year ago

I think the answer is A) Collection Ratio = 365 / Payable Turnover

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Naomi

1 year ago

Hmm, I see your point. Let's discuss it further to figure out the correct answer.

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Avery

1 year ago

I disagree, I believe the correct answer is D) Collection Ratio = 365 + Net Sales / Receivable Turnover.

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Naomi

1 year ago

I think the answer is C) Collection Ratio = 365 / Receivable Turnover.

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