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Question 50 Chapter 4 of +2-B
Trade Receivable Turnover Ratio
50. (Trade Receivable T/O Ratio for Two Years) Compute the Trade receivable Turnover ratio from the following :
| 2016 Year I (₹) | 2017 Year II (₹) | |
| Gross Sales (Revenue from Operation) | ₹ 9,00,000 | 7,50,000 |
| Trade Receivable at the beginning of the year | ₹ 83,000 | 1,17,000 |
| Trade Receivable at the end of the year | ₹ 1,17,000 | 83,000 |
| Sales Returns | 1,00,000 | 50,000 |
Year 2016
| Trade Receivable Turnover Ratio | = | Net Credit annual sales |
| Average trade receivable | ||
| Net Credit Sales | = | Total Credit Sales – Sales Return |
| = | ₹ 9,00,000 - ₹ 1,00,000 | |
| = | ₹ 8,00,000 | |
| Average Trade Receivable | = | Trade Receivable in the beginning + Trade Receivable at the end |
| 2 |
| = | ₹ 83,000 + ₹ 1,17,000 | |
| 2 | ||
| Average trade receivable | = | ₹ 1,00,000 |
| Trade Receivable Turnover Ratio | = | ₹ 8,00,000 |
| ₹ 1,00,000 | ||
| = | 8 times |
Year 2017
| Trade Receivable Turnover Ratio | = | Net Credit annual sales |
| Average trade receivable | ||
| Net Credit Sales | = | Total Credit Sales – Sales Return |
| = | ₹ 7,50,000 - ₹ 50,000 | |
| = | ₹ 7,00,000 | |
| Average Trade Receivable | = | Trade Receivable in the beginning + Trade Receivable at the end |
| 2 |
| = | ₹ 1,17,000 + ₹ 83,000 | |
| 2 | ||
| Average trade receivable | = | ₹ 1,00,000 |
| Trade Receivable Turnover Ratio | = | ₹ 7,00,000 |
| ₹ 1,00,000 | ||
| = | 7 times |
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "Question 50 Chapter 4 of +2-B - USHA Publication 12 Class", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to USHA Publication Part 2 volume I.
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