Accounts Receivable Turnover
$$ \text{Accounts Receivable Turnover}=\text{Net Credit Sales}/\text{Average Accounts Receivable} $$
Explanation**:** Accounts Receivable Turnover measures how many times a company collects its average accounts receivable during a specific period. It reflects the effectiveness of credit and collection policies.
Inventory Turnover
$$ \text{Inventory Turnover}=\text{Cost of Goods Sold}/\text{Average Inventory} $$
Explanation**:** Inventory Turnover assesses how many times a company's inventory is sold and replaced over a particular period. It provides insights into inventory management efficiency.
Both ratios are essential for evaluating a company's operational efficiency. A higher Accounts Receivable Turnover suggests effective credit management and timely collections, while a higher Inventory Turnover indicates efficient inventory control and sales performance.