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
Option 1: 29.6 times
Option 2: 2.96 times
Option 3: 29.6%
Option 4: 2.69:1
Correct Answer: 2.96 times
Solution : Trade Payable Turnover Ratio = Net Credit Purchases/Average Trade Payables = Net Credit Purchases/(Opening Creditors + Opening Bills Payables + Closing Creditors + Closing Bills Payables)/2 = ₹ 4,20,000/(₹ 90,000 + ₹ 52,000) = ₹ 4,20,000/1,42,000 = 2.96 times. Assuming that there are no closing Creditors and Bills Payables, hence we will not make their average.
Question : Match List-I with List-II.
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