Home For AAT student members AQ 2013 AAT Level 4 (Level 8 in Scotland)

Credit Control query

samilou67samilou67 Just JoinedRegistered Posts: 6
Can anyone shed some light on this for me?

Wilko has been trading with Johny for many years. Johny purchased 1200000 units from will in 2013. Sale price of the product is £6 per unit including VAT. At the end of 2013 johny owed £986301to Wilko.

What is the receivable collection period in days for the amount owed? The answer is 50 but I can't work out how?

Please help.

Comments

  • crispycrispy Trusted Regular SouthamptonRegistered Posts: 456
    Hello,

    The formula for calculation Debtor Days is Debtors / Sales * 365 so..........

    1,200,000 Units @ £ 6 = £ 7,200,000

    Closing Debtors = £ 986,601

    Therefore £ 986,301 / £ 7,200,000 * 365 Days = 50 Days

    Job Done :)
  • samilou67samilou67 Just Joined Registered Posts: 6
    oh thank you, very grateful
Sign In or Register to comment.