29. To measure how effectively an entity employs its inventory resources, an auditor calculates inventory turnover by dividing average inventory into

A) Net sales.

B) Accounts receivable.

C) Cost of goods sold.

D) Operating income.

30. An auditors preliminary analysis of the A/R turnover revealed the following rates over 3 years: 4.3 times (2019), 6.2 times (2018), and 7.3 (2017). Which of the following is the most likely cause of the decrease in accounts receivable turnover?

A) Increase in the cash discount offered

B) Liberalization of credit policy

C) Tightening of credit policy

D) Increased cash sales.