Dear Friends
I am confusing in calculation debtors receivable in days ration?
Average Debtors – 8 Crore Credit Sales – 15 Crore please calculate it?
3 Replies
ACCOUNTANT
(Student)
(559 Points)
Replied 22 September 2011
you asked in days ration no......im wrong then the other answer posted is right
ashish gupta
( student)
(1922 Points)
Replied 22 September 2011
| Debtors Turnover Ratio - 15/8 = 1.875 | |||
| In Days - 365/1.875 = 195 Days | |||
Bhaskar Unnikrishnan CPA CMA
(Accounts / Administration)
(414 Points)
Replied 22 September 2011
Single step is: Average Receivable / (Net credit Sales /365)
8,00,00,000 / (15,00,00,000/365) = 195.
This means that I the company collect its debts every 195 days or 1.875 (Debtors TO Ratio) times a year.
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