Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Debtors turnover ratio( or receivables turnover ratio)
Meaning: this ratio establishes a relation ship between net credit sales and averages trade debtors.
Objective: the objective of computing this ratio is to verify the efficiency with which the trade debtors are managed.
Components: There are two components of this ratio which are as under:
Net credit sales
Average trade debtors
Computation: this ratio is computed by dividing the net credit sales by average trade debtors. This ratio is usually expressed as x number of times. In the form of a formula this ratio may be expressed as under:
Net credit sales = gross credit sales -sales returns
Interpretation: it shows the number of times the debtors are turned over during a year. Generally the higher the value of debtors' turnover the more efficient is the management of debtors or more liquid is the debtors. Similarly low debtor's turnover implies inefficient management of debtors/sales and less liquid debtors a very high ratio may imply a firm inability due to lack of resources to sell on credit there by losing sales and profits. There is no rule of thumb which may be used as a norm to interpret the ratio as it may be different form firm to firm depending upon the nature of business. This ratio should be compared with ratio of other firm doing similar business and a trend may also be found to make a better interpretation of the ratio.
Planning A business must plan for its success. What do we understand by business planning? It is about thinking in advance -- to decide on a course of the action to reach
Linear Programming This section introduces the general method called the simplex algorithm, which is designed to solve any linear program. The information that can be secured
The significant functions of a treasury department are as given below: a) Setting up corporate financial goals Financial strategies and aim Treasury and financial po
State overhead expenses It is to be noted that the term overheard has a wider meaning than the term indirect expanses. Overheads include the cost of the indirect material and
MNO Ltd produces and sells for $25 an office machine for which there is a heavy demand which the company is prevented from meeting because of a shortage of skilled labour. The dire
The most ticklish difficulty that is faced through the finance manager is the resolve of the amount of working capital requirement at a specific level of production. To resolve thi
their definitions and the advantages and disadvantages
what is the topic about? what are the practical implications? what are the practical criticisms?
what are the stages of operational research
Debt equity ratio Meaning: this ratio establishes a relationship among long term debts and share holders funds. Objective: the objective of computing this ratio is to me
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd