In 2013, Toys 4 U had a trade payables turnover ratio of 6.08; in 2012, 5.87; and 5.45 in 2011. Which statement is true about what the ratios indicate?
A) Toys 4 U is taking longer to pay its vendors in 2013 versus 2012.
B) Toys 4 U has been increasing its average payables at a faster rate than its cost of goods sold has increased.
C) Toys 4 U is taking less time to pay vendors in 2013 than it took in both 2012 and 2011.
D) Toys 4 U is taking less time to collect from its customers.
Correct Answer:
Verified
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