Average Accounts Receivable Calculation

A company, XYZ Corp, is evaluating its performance in managing accounts receivable (AR). Currently, the company has a receivables turnover ratio of 5, which indicates how effectively it is collecting outstanding debts. If the company’s net credit sales are $1,000,000, what is the average accounts receivable balance for XYZ Corp?

The receivables turnover ratio is calculated as:

Receivables Turnover Ratio = Net Credit Sales / Average Accounts Receivable

Based on this information, which of the following is the most accurate average accounts receivable balance for XYZ Corp?