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Q. What do you meant by Trade payable days?
Year-end trade payables/Credit purchases (or cost of sales)x 365 days
This is the length of time taken to pay suppliers. Ratio can also be calculated using cost of sales, as credit purchases aren't usually stated in the financial statements. High trade payable day's is good as credit from suppliers represents free credit. If it's too high then there is a risk of suppliers not extending credit in the future and may lose goodwill. High trade payable days may also indicate that business has no cash to pay which indicates insolvency problems.
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