The average payment period is computed by dividing the year-end accounts payable amount by the firm's average cost of goods sold (COGS) per day.

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The formula for average payment period is (Accounts Payable / COGS) x Number of days. However, the statement mentions dividing the year-end accounts payable by the firm's average cost of goods sold per day, which is incorrect.

The Average Payment Period Is Computed by Dividing the Year-End