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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Compute the Trade Receivables Turnover Ratio from the following:
| Particulars | 31st March, 2022 (₹) | 31st March, 2023 (₹) |
|---|---|---|
| Revenue from Operations (Net Sales) | 8,00,000 | 7,00,000 |
| Debtors at the beginning of year | 83,000 | 1,17,000 |
| Debtors at the end of year | 1,17,000 | 83,000 |
| Sales Return | 1,00,000 | 50,000 |
Average Debtors (2022) = (83,000 + 1,17,000) ÷ 2 = ₹1,00,000
Average Debtors (2023) = (1,17,000 + 83,000) ÷ 2 = ₹1,00,000
Trade Receivables Turnover Ratio (2022) = Net Sales ÷ Average Debtors = 8,00,000 ÷ 1,00,000 = 8 times
Trade Receivables Turnover Ratio (2023) = Net Sales ÷ Average Debtors = 7,00,000 ÷ 1,00,000 = 7 times
Note: Since Revenue from Operations is explicitly given as "Net Sales" (already net of returns), the separately-listed Sales Return figures are not applied again here.
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 "T.S. Grewal Class 12 Vol 3 Chapter 4 Q.100 - Accounting Ratios", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 4 - Accounting Ratios.
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