Question 94 Chapter 4 of +2-B - T.S. Grewal 12 Class

Question 94 Chapter 4 of +2-B

Table of Contents

The solution of Question 94 Chapter 4 of +2-B: –

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

Trade Receivables Turnover Ratio

94. Calculate Trade payables Turnover Ratio from the following information:Opening Creditors Rs. 1,25,000; Opening Bills Payable Rs. 10,000; Closing Creditors Rs. 90,000; Closing bills Payable Rs. 5,000; Purchases Rs. 9,50,000; Cash Purchases Rs. 1,00,000; Purchases Return Rs. 45,000.

The solution of Question 94 Chapter 4 of +2-B: –

Net Credit Purchases	=	Purchases – Cash Purchases – Purchase Return
	=	Rs. 9,50,000 – Rs. 1,00,000 – Rs. 45,000
	=	Rs. 8,05,000

Average Trade Receivable	=	Opening Creditors & BP + Closing Creditors & BP
		2

	=	1,25,000 + 10,000 + 90,000 + 5,000
	=	2
	=	Rs. 1,15,000
Trade Receivables Turnover Ratio	=	Net Credit Sales
		Average Trade Receivable
	=	Rs. 8,05,000
	=	Rs. 1,15,000
	=	7 Times