Nexus between Average Collection Period and Profitability of Registered Industrial Companies in Tanzania
Keywords:
Average Collection Period, Profitability, Listed Manufacturing CompaniesAbstract
Working capital management is vital to wholly registered firms with numerous depositors in the community, including the industry, which is characterized by popular inventory actions, money, borrowers, and account payables, which are key working capital components. This study determines the relationship between the average collection period and effectiveness of registered industrial firms on the Dar es Salaam Stock Exchange (DSE). This study adopted a descriptive research design, utilizing secondary data from five ages from 2015 to 2020. Seven firms from one industrial zone are employed in this study. Research indicates that average payable days have an optimistic association with profitability. The study recommends that DSE managers endeavor to ensure that the average collection period is too short to recover their profitability level and ensure effective credit standards and credit analysis; bosses must pay kindness to the size of their companies’ turnover in the development plan of the association.
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