Question 47 Chapter 4 of +2-B

Question 47 Chapter 4 of +2-B

III. Activity Ratios

Trade Receivable Turnover Ratio

47. (Calculation of Trade Receivable at the beginning & at the end) ₹ 1,75,000 is the net credit sales (Revenue from Operation) of a concern during the year. If revenue from operation turnover is 8 times, calculate trade receivable in the beginning and at the end of the year. Trade receivable at the end is ₹ 7,000 more than at the beginning.

 

The solution of Question 47 Chapter 4 of +2-B: – 

 

Trade Receivable Turnover Ratio=Net Credit Sales
Average Trade Receivable
   
8=Net Credit Sales
Average Trade Receivable
   
Average Trade Receivable=Net Credit Sales
  Trade Receivable Turnover Ratio
   
 =₹ 1,75,000
  8
   
 =₹ 21,875
Average Trade Receivable=Opening Trade Receivable + Closing Trade Receivable
2
   
Let assume Opening trade receivable=x
Closing trade receivable=x + ₹ 7,000
₹ 21,875=x + (x + ₹ 7,000)
2
₹ 21,875 x 2=x + (x + ₹ 7,000)
₹ 43,750=2x + ₹ 7,000)
₹ 43,750 – ₹ 7,000=2x
₹ 36,750=2x
x=₹ 36,750
2
 =₹ 18,375
Closing trade receivable=₹ 18,375 + ₹ 7,000
 =₹ 25,375

 

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 3 min 225x300 - Question 47 Chapter 4 of +2-B  - USHA Publication  12 Class
T.S. Grewal’s Analysis of Financial Statements

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