# Question 50 Chapter 4 of +2-B – USHA Publication 12 Class

Q-50- CH-4 Book 2 - Usha Pub. +2 Book 2020 - Solution

Question 50 Chapter 4 of +2-B

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

## The solution of Question 50 Chapter 4 of +2-B: –

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
 = ₹ 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