If a supplier was interested in whether or not they will be paid on time,which of the calculations would they make?
A) Trade receivables /sales revenue x 365
B) Sales revenue/trade receivables x 365
C) Trade payables/cost of sales x 365
D) Cost of sales/trade payables x 365

Question

Quizplus · Accepted Answer

The calculation that would be relevant for a supplier interested in whether or not they will be paid on time is trade payables/cost of sales x 365. This calculation determines the number of days it takes a company to pay its suppliers. If the number of days is low, it indicates that the company pays its suppliers on time. Therefore, choice C is the best option.

If a Supplier Was Interested in Whether or Not They