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Question

Trade Payables Turnover Ratio
= ______________ / __________________

A
Average Trade Receivables / Net Credit Purchases
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B
Net Credit Purchases / Average Trade Payables
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C
Net Trade Purchases / Average Trade Receivables
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D
None of these
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Solution

The correct option is B Net Credit Purchases / Average Trade Payables
Trade Payables Turnover Ratio
= Net Credit Purchases / Average Trade Payables

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