Question : Read the following information carefully and answer the question
|
Particulars |
|
|
Revenue from Operations |
8,75,000 |
|
Creditors |
90,000 |
|
Bills Receivable |
48,000 |
|
Bills Payable |
52,000 |
|
Purchases |
4,20,000 |
|
Trade Debtors |
59,000 |
Q. Calculate Average Collection Period.
Option 1: 30 days
Option 2: 60 days
Option 3: 45 days
Option 4: 15 days
Answer (1)
14th Jan, 2024
Correct Answer: 45 days
Solution : Average Collection Period = 365 Days/Trade Receivables Turnover Ratio = 365 Days/8.18 Times (Calculated in Question 4) = 45 Days
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