A-LevelAccountingAnalysis and Interpretation of Financial StatementsMay/June 2021Paper 1 Q181 Mark
The trade receivables turnover ratio figures for two companies are shown. company turnover in days X 45 Y 55 What does this indicate about company Y?
AIt has higher levels of trade receivables than X.
BIt has higher liquidity than X.
CIt is less efficient in managing its receivables than X.
DIt offers less credit to its customers than X.
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of analysis and interpretation of financial statements within the Accountingsyllabus. The examiner's mark scheme requires...
📋 Examiner Report & Trap Analysis
Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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