The following information is available for Robin and Sparrow Limited for the 20X6 financial year: What was the trade payables' turnover period in days (to one decimal place)?
A)51.2 days
B)48.4 days
C)53.9 days
D)40.1 days

Question

The following information is available for Robin and Sparrow Limited for the 20X6 financial year:  What was the trade payables' turnover period in days (to one decimal place)?
A)51.2 days 
B)48.4 days 
C)53.9 days 
D)40.1 days

Quizplus · Accepted Answer

Trade payables' turnover period = (Trade payables / Cost of sales) x 365
Trade payables = 600
Cost of sales = 1,440
Trade payables' turnover period = (600 / 1,440) x 365 = 151,200 / 1,440 = 105 
Trade payables' turnover period in days = 365 / 105 = 3.48 (to one decimal place)
Therefore, the trade payables' turnover period in days is 48.4 days.

The Following Information Is Available for Robin and Sparrow Limited