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Q. Explain about Trade receivable days?
{Yearend trade receivables / Credit sales (or turnover)} x 365 days
This is the average length of time occupied by customers to pay. A long average collection means poor credit control and henceforth cash flow problems may occur. Normal stated credit period is 30 days for most industries. Alterations in the ratio may be due to improving or worsening credit control. Major new customer pays fast or slow. Change in credit terms or early settlement discounts are offered to customers for early payment of invoices.
Q. Explain Two-part tariff system? With a two-part tariff system the buyer is charged: A transfer price equal to the seller's variable (marginal) cost for each unit sold
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Investigation of potential solutions The investigation of potential software solutions must involve what is common practice in the industry. Consider the following questions:
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