Creditors payment period ratio, Finance Basics

Creditors Payment Period Ratio

Creditors payment period =   365/ Creditors turnover

                                          = (365 x Average creditors)/Annual credit purchases

  • The ratio signify the credit period granted via the suppliers that is the period
  • Within that the firm should pay its liabilities to the suppliers.
  • The shorter the duration the higher the creditors turnover and vice-versa.
Posted Date: 1/30/2013 1:50:08 AM | Location : United States







Related Discussions:- Creditors payment period ratio, Assignment Help, Ask Question on Creditors payment period ratio, Get Answer, Expert's Help, Creditors payment period ratio Discussions

Write discussion on Creditors payment period ratio
Your posts are moderated
Related Questions
Type of Partners 1) Active Partner 2) Sleeping Partner 3) Quasi or Nominal Partner 4) Minor Partner 5) Major Partner 6) In-coming Partner 7) Out-going Partner

Determine the Present Value of An Annuity and give explanation of this topic?????

Example of Market Model Illustration: For the past five (5) years, the MPS and DPS for XYZ Ltd were follows as:   1998 Shs. 1999 Shs.

Inventories turnover 8 times 4 times Receivable days 63 days 40 days

Hatch System - Stock Exchange This is an automatic system based on the assumption such when investors sell at a certain percent age below the top of the market and buys at a s

Setting a Reorder Point - ROP  Once the order quantity has been determined, the next question to be settled is when to place the order. If an order is released and it takes th

Setting of Optimal Cash Balance Cash is often identified like a non-earning asset since holding cash quite than a revenue-generating asset includes a cost in form of foregone

Cash Cycle and Cash Turnovers Cash Cycle refers to the amount of time which elapses from the point whenever the firms create a cash outlay to purchase raw materials to the poi

Constraints of Venture Capital in US 1. Require of rich investors in US, thus inadequate equity capital. 2. Inefficiencies of stock market - NSE is investors and inefficien

Contribution Margin The Average of the industry Contribution Margin (CM) was 15.40% for 2004, 14.39% for 2005, and 13.18% for 2006. The chart showed that Contribution Mar