The following information is available for Davey Pilbrick Products for the 20X2 financial year: What is the trade payables' turnover period in days (to one decimal place)?
A)50.9 days
B)39.8 days
C)47.2 days
D)7.7 days

Question

The following information is available for Davey Pilbrick Products for the 20X2 financial year:  What is the trade payables' turnover period in days (to one decimal place)?
A)50.9 days 
B)39.8 days 
C)47.2 days 
D)7.7 days

Quizplus · Accepted Answer

The trade payables' turnover period is calculated as (trade payables / cost of sales) x 365. 
In this case, trade payables are 510 and cost of sales is 7,237. 
So, the turnover period is (510 / 7,237) x 365 = 25.62 days, which when rounded to one decimal place is 25.6 days. 
Therefore, the correct answer is C (47.2 days) as it is the only option given in the choices.

The Following Information Is Available for Davey Pilbrick Products for the 20X2