12th | Ts grewal 2021-2022 Question 86 to 90 | ch:4 Accounting Ratios

Page No 4.112:

Question 86:

Calculate Trade Receivables Turnover Ratio from the following information:
 

 

Opening Balance ( `)

Closing Balance ( `)

Sundry Debtors

28,000 

25,000

Bills Receivable

7,000

15,000

Provision for Doubtful Debts

2,800

2,500


Total Sales  ` 1,00,000; Sales Return 
` 1,500; Cash Sales  ` 23,500.

Answer:

Net Credit Sales = Total Sales − Sales Return − Cash Sales

= 1,00,000 − 1,500 − 23,500 = 75,000

Average receivables= Opening Receivables +Closing Receivables/2

Average receivables= 28,000+7,000+25,000+15,000/2=37,500

Trade receivable turnover ratio= Net sales/ Average receivables

Trade receivable turnover ratio= 75,000/37,500 = 2 Times

 



Page No 4.113:

Question 87:

Closing trade receivables `90,000, Revenue from operation `7,20,000, Cash Revenue from operation `1,80,000, Provision for Doubtful debts `8,000. Calculate Trade receivable turnover ratio.

Answers;

Trade receivable turnover ratio = Credit revenue from operation/ Average trade receivable

Trade receivable turnover ratio = 5,40,000/90,000 = 6 Times

Credit revenue from operations= Revenue from operations - Cash revenue from operation

5,40,000 = 7,20,000 – 1,80,000



Page No 4.113:

Question 88:

Closing Trade Receivables  ` 1,00,000; Cash Sales being 25% of Credit Sales; Excess of Closing Trade Receivables over Opening Trade Receivables  ` 40,000; Revenue from Operations, i.e., Net Sales  ` 6,00,000. Calculate Trade Receivables Turnover Ratio.

Answer:

Let Credit Sales be = x

Cash Sales=x+25/100=25x/100

Total Sales = Cash Sales + Credit Sales

6,00,000=25x/100

Or, 125x/100=6,00,000

Or , x×6,00,000×100/125=4,80,000

Credit Sales = 4,80,000

Closing Trade Receivables = Opening Trade Receivables + 40,000

1,00,000 = Opening Trade Receivables + 40,000

Opening Trade Receivables =  ` 60,000

Average receivables= Opening Receivables +Closing Receivables/2

Average receivables= 1,00,000+60,000/2=80,000

Trade receivable turnover ratio= Net sales/ Average receivables

Trade receivable turnover ratio= 4,80,000/80,000= 6 Times

 



Page No 4.113:

Question 89:

From the following particulars, determine Trade Receivables Turnover Ratio:
 

 

 `

Revenue from Operations (Net Sales)

20,00,000

Credit Revenue from Operations (Credit Sales)

16,00,000

Trade Receivables

2,00,000

 

Answer:

Credit Sales = 16,00,000

Average Debtors = 2,00,000
Trade receivable turnover ratio= Net sales/ Average receivables

Trade receivable turnover ratio= 16,00,000/2,00,000= 8 Times

 



Page No 4.113:

Question 90:

Compute Trade Receivables Turnover Ratio from the following:
 

 

31st March, 2020( `)

31st March, 2021( `)

Revenue from Operations (Net Sales)

8,00,000 

7,00,000

Debtors in the beginning of year

83,000

1,17,000

Debtors at the end of year

1,17,000

83,000

Sales Return

1,00,000

50,000

Answer:

Average Debtors =Opening Debtors + Closing Debtors/2

 

In 2017 = 83,000 + 1,17,000/2 =  ` 1,00,000      

 

In 2018 =  1,17,000 + 83,000/2 =  ` 1,00,000

Debtors Turnover Ratio = Net Sales/Average Debtors               

In 2020         = 8,00,000/1,00,000 = 8 Times              

 In 2021        = 7,00,000/1,00,000 = 7 Times

 

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Chapter-4: Accounting Ratios | 2021-2022

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