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

#### 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.

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

#### 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.

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

#### 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.

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

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

#### 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

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

#### 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

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