Question 49 Chapter 4 of +2-B – USHA Publication 12 Class

Q-49- CH-4 Book 2 - Usha Pub. +2 Book 2020 - Solution

Question 49 Chapter 4 of +2-B

Trade Receivable Turnover Ratio

49. (Trade Receivable T/O Ratio when Provision for Doubtful Debt is given) ABC Ltd Provides the following information

 Trade Receivable in the beginning ₹ 10,00,000 Trade Receivable at the end ₹ 1,50,000 Cash sales during the year (Revenue from Operation) ₹ 2,50,000 Credit sales during the year (Revenue from Operation) Return inwards Provision for bad and doubtful debts

The solution of Question 49 Chapter 4 of +2-B: –

 Trade Receivable Turnover Ratio = Net Credit annual sales Average trade receivable Net Credit Sales = Total Credit Sales – Sales Return = ₹ 2,50,000 – ₹ 10,000 = ₹ 2,40,000
 Average Trade Receivable = Trade Receivable in the beginning + Trade Receivable at the end 2
 = ₹ 50,000 + ₹ 30,000 2 Average trade receivable = ₹ 40,000
 Trade Receivable Turnover Ratio = ₹ 2,40,000 ₹ 40,000 = 6 times
 Average Collection Period = Number of days in the year Trade Receivable turnover ratio Average trade receivable = 360 6 Average Collection Period = 60 Days

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

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

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