The company had an opening stock of OMR 20,000 during the last year and made a total purchase of 48,000 OMR. The company has returned OMR 3000 worth material due to quality issues. During the last year, the business has paid OMR 6000 as wages and OMR 8000 as salaries. The company sold goods for a total amount of OMR 70,000 of which OMR 30,000 sales was on cash basis. Average debtors during the last year was 15,000 OMR, average creditors were 15,000 OMR and closing inventory was OMR 26,000. Average payment period of Amman Ltd. from the following? a. 132.56 b. 110.76 c. 121.67 d. 128.56
Amman Ltd. is a manufacturing company that produces paper cups and plates in Nizwa. The company was able to sustain a reasonable amount of sales in the last two quarters despite the pandemic-crisis during the last year. However, the company has faced some serious liquidity problems due to delayed payment by the customers and lower sales in the first two quarters. Hence, the company is seriously thinking about revising its working capital standards by considering the changes in the market. The finance manager of the company is seeking your help in assessing the Average payment period from the following financial data.
The company had an opening stock of OMR 20,000 during the last year and made a total purchase of 48,000 OMR. The company has returned OMR 3000 worth material due to quality issues. During the last year, the business has paid OMR 6000 as wages and OMR 8000 as salaries. The company sold goods for a total amount of OMR 70,000 of which OMR 30,000 sales was on cash basis. Average debtors during the last year was 15,000 OMR, average creditors were 15,000 OMR and closing inventory was OMR 26,000.
Average payment period of Amman Ltd. from the following?
132.56
110.76
121.67
128.56
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