Question 80 Chapter 4 of +2-B
Table of Contents
Interest Coverage Ratio
80. Calculate Trade Receivables Turnover Ratio from the following information:
| 31st March 2018 | 31st March 2019 | |
| Sundry Debtors | 28,000 | 25,000 |
| Bills Receivable | 7,000 | 15,000 |
| Provision for Doubtful Debts | 2,800 | 2,500 |
Total Sales Rs. 1,00,000; Sales Return Rs. 1,500; Cash Sales Rs. 23,500
The solution of Question 80 Chapter 4 of +2-B: –
| Net Credit Sales | = | Total Sales − Sales Return − Cash Sales |
| = | Rs. 1,00,000 − Rs. 1,500 − Rs. 23,500 | |
| = | Rs. 75,000 |
| Average Trade Receivable | = | Opening Debtors + Opening Bills Receivable + Closing Debtors + Closing bills Receivable |
| 2 |
| Average Trade Receivable | = | Rs. 28,000 + Rs. 7,000 + Rs. 25,000 + Rs. 15,000 |
| 2 | ||
| = | Rs. 37,500 |
| Inventory Turnover Ratio | = | Net Credit Sales |
| Average Trade Receivable |
| Inventory Turnover Ratio | = | Rs. 75,000 |
| Rs. 37,500 | ||
| = | 2 Times |
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Balance Sheet: Meaning, Format & Examples
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Also, Check out the solved question of previous Chapters: –
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)
- Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
- Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
- Chapter No. 3 – Goodwill: Nature and Valuation
- Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
- Chapter No. 5 – Admission of a Partner
- Chapter No. 6 – Retirement/Death of a Partner
- Chapter No. 7 – Dissolution of a Partnership Firm
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 8 – Company Accounts – Accounting for Share Capital
- Chapter No. 9 – Company Accounts – Issue of Debentures
- Chapter No. 10 – Redemption of Debentures
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 1 – Financial Statements of a Company
- Chapter No. 2 – Financial Statement Analysis
- Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
- Chapter No. 4 – Accounting Ratios
- Chapter No. 5 – Cash Flow Statement
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