Which of the following statements about the interpretation of the receivables turnover ratio is not correct?

Multiple Choice

• Analysts often interpret a sudden increase in the receivables turnover ratio as a signal of a developing problem.

• The smaller the receivables turnover ratio the larger the days to collect.

• A change in the receivables turnover ratio may indicate a change in the company's credit granting policies.

• A change in the receivables turnover ratio may indicate a change in economic conditions.