Debtors receivables turnover:
It shows the relationship between credit sales and debtors of a firm.
It is sometimes difficult for the analyst to identify credit sales, average debtors and average bills receivable. Mainly to ascertain opening and closing details to identify average of it feels difficult in certain cases. To avoid difficulty of above cases, the alternative method is to calculate the debtors turnover in terms of the relationship between total sales and closing balance of debtors.
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