Accounting Multiple Choice Question – 1 October 2022

The following information is given for a business.

• Sales = £650 000
• Cost of Sales = £(502 000) = = > Stock 1 January £19 000 + Purchases £508 000 – Stock 31 December £25 000
• Gross Profit = £148 000

• Inventory turnover days – 16 days
• Trade receivables 31 December – £48,082
• Trade payables 31 December – £44,537

What is the working capital cycle?

Select ONE answer:

1. 11 days
2. 21 days
3. 43 days
4. 75 days

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Trade Receivable days + Inventory turnover days – trade payable days = 27 days + 16 days – 32 days
2. Not correct
3. Not correct
4. Not correct

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