Question : What does Creditors Turnover Ratio take into account:
Option 1: Total credit purchases
Option 2: Total credit sales
Option 3: Total cash purchases
Option 4: Total cash sales
Answer (1)
11th Jan, 2024
Correct Answer: Total credit purchases
Solution : Accounts Payable Turnover Ratio, Creditors Turnover Ratio, and Trade Payables Turnover Ratio are other names for this metric. This ratio is used to calculate how frequently a company pays its suppliers or Creditors within a certain accounting period.
Hence the correct answer is option 1.
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