Ratios

reynolds30

I am in the process of creating some new ratios for our management reports and I can't for the life of me remember how to do debtors, creditor and stock days.

I have actually dug out my old BPP unit 11 book and still can't work it our from the figures in my accounts.

Can anyone supply an idiot guide for me, as my brain is old and frazzled.

Thanks

welshboy

Hi,

If this is for the calculation of Receivable Collection days and Trade payable payment period the calculations are

Trade Payable x 365
Purchases

For Trade receivables

Trade Receivables x 365
Revenue

Inventories

Inventories x 365
Cost of sales

Hope this helps

Regards

Matt:thumbup1:

reynolds30

Was that in Welsh or English????.....lol