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 Ratios
11-26-2009, 04:32 AM
Post: #1
 taragbeh Junior Member Posts: 3 Joined: Nov 2009 Reputation: 0
Ratios
How do i calculate accounts payable period?
11-26-2009, 05:04 AM
Post: #2
 kamranACA Posting Freak Posts: 2,351 Joined: Feb 2007 Reputation: 0

Ratio = (Average accounts payable* / purchases during the year) x 365 days

*Average A/C payable = (opening balance of A/C payable + closing balance of A/C payable) / 2

Regards,
11-26-2009, 05:08 AM
Post: #3
 taragbeh Junior Member Posts: 3 Joined: Nov 2009 Reputation: 0

Thanks but how can I calculate the purchases if it not given on the financial statement?

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by kamranACA</i>
<br />
Ratio = (Average accounts payable* / purchases during the year) x 365 days

*Average A/C payable = (opening balance of A/C payable + closing balance of A/C payable) / 2

Regards,
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
11-26-2009, 05:15 AM
Post: #4
 kamranACA Posting Freak Posts: 2,351 Joined: Feb 2007 Reputation: 0

Dear

You may find purchases in the note of "Cost of Sales" (or its sub-note) where normally the reconciliation of material consumed is disclosed. If it is not disclosed try the following

Material purchased =

Closing stock of Raw material (normally disclosed as a component of stock-in-trade)

Raw Material Consumed (normally disclosed in cost of sales)

Less

Opening stock of Raw material (normally disclosed as a component of stock-in-trade in comparative figures)

If you don't find purchases by any means, then you can at least take "Cost of Sales" instead of Purchases. Although it's not appropriate but is used in various solutions theoratically.

Regards,

KAMRAN.
11-26-2009, 05:18 AM
Post: #5
 taragbeh Junior Member Posts: 3 Joined: Nov 2009 Reputation: 0

thx

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by kamranACA</i>
<br />Dear

You may find purchases in the note of "Cost of Sales" (or its sub-note) where normally the reconciliation of material consumed is disclosed. If it is not disclosed try the following

Material purchased =

Closing stock of Raw material (normally disclosed as a component of stock-in-trade)

Raw Material Consumed (normally disclosed in cost of sales)

Less

Opening stock of Raw material (normally disclosed as a component of stock-in-trade in comparative figures)

If you don't find purchases by any means, then you can at least take "Cost of Sales" instead of Purchases. Although it's not appropriate but is used in various solutions theoratically.

Regards,

KAMRAN.

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
11-26-2009, 05:28 AM
Post: #6
 kamranACA Posting Freak Posts: 2,351 Joined: Feb 2007 Reputation: 0

Welcome buddy.

Regards,
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