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 Trade Receivables Turnover Ratio.
Option 1: 8.18 times
Option 2: 8.23:1
Option 3: 8.18%
Option 4: 8.81:1
Correct Answer: 8.18 times
Solution : Trade Receivable Turnover Ratio = Revenue from Operations/Average Trade Receivables = Revenue from Operations/(Opening Trade Debtors + Opening Bills Receivables + Closing Trade Debtors + Closing Bills Receivables)/2 = ₹ 8,75,000/(₹ 59,000 + ₹ 48,000) = ₹ 8,75,000/1,07,000 = 8.18 times. Assuming that there are no closing Trade Debtors and Bills Receivables, hence we will not make their average.
Question : Match List-I with List-II.
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