Question 54 Chapter 4 of +2-B

Question 54 Chapter 4 of +2-B

III. Activity Ratios

Trade Receivable Turnover Ratio

54. (Trade Payable T/O Ratio & Average Payment Period) Calculate (i) Trade Payable turnover ratio and (ii) average payment period.

 2016 ₹2017 ₹
Annual credit purchases 6,80,000 7,50,000 
Creditors on January 1 80,00060,000
Creditors on December 31 60,00090,000

Take 360 days in a year

The solution of Question 54 Chapter 4 of +2-B: – 

2016

Trade Payable Turnover ratio=Net credit Purchases
Average Trade Payable
   
Average Trade Payable=Opening trade Payable + Closing Trade Payable
2
Net credit Purchases=₹ 6,80,000
   
 =₹ 80,000 + ₹ 60,000
 2
   
 =₹ 70,000
   
Trade Payable Turnover ratio=₹ 6,80,000
₹ 70,000
   
 =9.71 times
   
Average Payment period=No. of days in a year
Trade Payable Turnover ratio
   
 =360
 9.71
   
 =39 days

 

2017

Net credit Purchases=₹ 7,50,000
   
 =₹ 60,000 + ₹ 90,000
 2
   
 =₹ 75,000
   
Trade Payable Turnover ratio=₹ 7,50,000
₹ 75,000
   
 =10 times
   
Average Payment period=No. of days in a year
Trade Payable Turnover ratio
   
 =360
 10
   
 =36 days

 

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 54 Chapter 4 of +2-B  - USHA Publication  12 Class
T.S. Grewal’s Analysis of Financial Statements

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