Explain the term- trade receivable days, Financial Management

Assignment Help:

Explain the term- Trade receivable days (turnover)

[Yearend trade receivables/Credit sales (or turnover)] x   365days

It is the average length of time taken 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.

Changes in the ratio may be because of improving or worsening credit control. Major new customer pays slow orfast. Change in credit terms or early settlement discounts are offered to customers for early payment of invoices.

 


Related Discussions:- Explain the term- trade receivable days

Volume of issues of central and state government securities, Volume of Issu...

Volume of Issues of Central and State Government Securities The growth of government securities market in India and the investor response to the government bond issues can be k

Case Study: Trade Finance and Risk, Can Engineering Tech effectively protec...

Can Engineering Tech effectively protect its interests and assure payment?

Evaluate the extent to which the balanced scorecard, Evaluate the extent to...

Evaluate the extent to which the Balanced Scorecard: The Balanced Scorecard has been described as an effective measurement system which enables managers of an organisation to

Ratio calculations from financial statements, Ricardo Martinez has prepared...

Ricardo Martinez has prepared the following financial statement projections as part of his business plan for starting the Martinez Products Corporation.  The venture is to manufact

Option-adjusted spread (oas), Option-Adjusted Spread (OAS) The prime ob...

Option-Adjusted Spread (OAS) The prime objective of an investor is to buy securities which have values greater than their market prices. The discussion made on the above valuat

Interpretations of activity ratio''s, Activity Ratio's   RT:        ...

Activity Ratio's   RT:           The Receivables Turnover ratio is the ratio between sales to accounts receivables. This says exactly how fast a company can collect on the s

Company''s stock price, A company is expected to pay a dividend of D1 = $1....

A company is expected to pay a dividend of D1 = $1.25 per share at the last of the year, and that dividend is expected to grow at a constant rate of 6.00% per year in the future.

Define minimum price make producers as a whole worse off, Suppose the gover...

Suppose the government regulates the price of a good to be no lower than some minimum level. Can such a minimum price make producers as a whole worse off?  Explain. As a higher

Bse-500 and sectoral indices, BSE-500 and Sectoral Indices On August 9,...

BSE-500 and Sectoral Indices On August 9, 1999, another new index was introduced in the market which was based on the data of 500 companies and designated as BSE-500 index. It

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd