are debtors arising out of credit sale of fixed assets included in trade receivables while calculating Trade receivable turnover ratio?

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Solution

Dear Student,

Debtors arising out of credit sales of fixed assets are not considered for the calculation of Trade receivables turnover ratio. As debtors represents those persons to whom goods are sold on credit. When any amount is due to receive in respect of credit sale of asset, it is not categorised in the list of normal debtors.

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