Question

From the following information, calculate:-

(i)Debtors Turnover Ratio


Sales ₹8,75,000
Bills Receivable ₹48,000
Purchases ₹4,20,000
Creditors ₹90,000
Bills Payable ₹52,000
Debtors ₹59,000
(Ans. (i) 8.18 times)

Answer 1

hey

answer...

Answer

Correct option is

B

4 times

Average debtors = (Rs. 40,000 + Rs. 1,20,000)/2 = Rs. 80,000

Cash sales = 20% of total sales

= Rs. 4,00,000 x 20%

= Rs. 80,000

Net credit sales = Total sales - Cash sales

= Rs. 4,00,000 - Rs. 80,000

= Rs. 3,20,000

Debtors turnover ratio = Net credit sales/Average debtors

= Rs. 3,20,000/Rs. 80,000

= 4 Times