UNIT 7 - RECIEVABLES DAYS

Question 1

What typeof ratio is recievables days

Answer 1

efficiency

Question 2

what do recievales dyas measure

Answer 2

how successfully managers acquire payments fromdebtors

sale may be made but money is not recieved yet due to trade credit becoming more popular B2B(OG, suppliers) and B2C

Question 3

how to calculate recievables dyas

Answer 3

recievables/revenue x 365

Question 4

recievables are

Answer 4

debtors

Question 5

debtors are a

Answer 5

CURRENT ASSET

Question 6

as recievables are debtors and debtors are acurrent asset where are recievables found

Answer 6

balance sheet

Question 7

revenue is found on

Answer 7

Income statement

Question 8

do we want R to be smaller or bigger than payables

Answer 8

smaller

Question 9

why do we want R to be smaller than payables

Answer 9

receive debtors (£ in ) before paying out to suppliers

Question 10

what are the benefts of a lower recievbale number (2)~

Answer 10

accrue interest as have cash for x days linger
Increases liquidity so cashflow better

Question 11

but nowadays common for firms to do what and why

Answer 11

give credit

ncrease sales

Question 12

what is credit used as

Answer 12

marketing ploy

Question 13

if credit to customers is introduced by a firm what happens to reciebales days

Answer 13

increase

Question 14

what explain how trqde credit is abenfit for fimrs

Answer 14

Induce sales from customers as now able to afford product which they couldn’t without trade credit

Question 15

key analysis about trade credit

peer pressure lol
3 marks

Answer 15

Pressures to do it as if customers cant afford you atm go to rival

this can reduce your market share

So consider it in balance f introduced to bs as may make em more competitive/ able to compete in LT

Question 16

Higher receivable days suggests cash/liquidity issue so may need to use

Answer 16

debt factogin