Question

cash revenue from operation 60% of credit revenue from operation. Total revenue from operation ₹ 5,20,000 . Closing trade receivable ₹80,000 opening trade receivable 3/4th of closing trade receivable. Compute Trade receivable turnover ration​

Answer 1

Answer:

trade receivables turnover ratio = credit revenue from operations/average trade receivables

= 3,25,000/70,000

= 4.64 times

let the credit revenue from operation be ₹x

credit revenue from operation = total revenue from operation - cash revenue from operation

x = 5,20,000 - (60 × x/100)

x = 5,20,000 - 6x/10

10x = 52,00,000 - 6x

16x = 52,00,000

x = 3,25,000

average trade receivables = opening trade receivables + closing trade receivables/2

= 80,000 + 60,000/2 = 70,000