FRF7

MC Question 6

The following information has been taken or calculated from Fowler’s financial statements for the year ended 30 September 2014.

Fowler’s cash cycle at 30 September 2014 is 70 days.

Its inventory turnover is six times.

Year-end trade payables are $230,000.

Purchases on credit for the year were $2 million.

Cost of sales for the year was $1·8 million.

What is Fowler’s trade receivables collection period as at 30 September 2014? All calculations should be made to the nearest full day. The trading year is 365 days.

A     106 days
B     89 days
C     56 days
D     51 days

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