O-LevelAccountingAnalysis and interpretation7707/11 · May/June 2025 · Q331 Mark
The trade receivables turnover of a business is 42 days. Trade receivables are allowed 30 days to settle their accounts. The business has difficulty paying its credit suppliers. Which statements are correct? 1 Credit customers are taking longer than allowed to pay their accounts. 2 It takes on average 42 days to receive payments from credit customers. 3 It would be easier to pay credit suppliers if credit customers paid within 30 days. 4 The business has an efficient credit control system.
A1 and 2 only
B1, 2 and 3
C2 and 4
D4 only
✓ Correct answer
B: 1, 2 and 3
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