|
Adjusted Trade Creditor
Period (days)
|
100 X Trade
creditors x 365 |
|
turnover X 75 |
Benchmark: 35-40 days
The
average number of days credit given by suppliers (adjusted)
Here,
turnover is grossed down to represent sales at cost prices i.e. an assumed 25%
margin is deducted. This enables sales and trade credit to be compared on a
like-for-like basis.
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