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Question
From the following particulars, determine Trade Receivables Turnover Ratio:
| ₹ | |
| Revenue from Operations (Net Sales) | 10,00,000 |
| Credit Revenue from Operations (Credit Sales) | 8,00,000 |
| Trade Receivables | 1,00,000 |
Solution
Credit Sales = 8,00,000
Average Debtors = 1,00,000
Trade Receivable Turnover Ratio = `"Net Credit Sales"/"Average Trade Receivables"`
`= 800000/100000` = 8 times
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Rs |
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Current Assets |
35,000 |
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Current Liabilities |
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