One way to show a trade creditor you’re a good partner is to have a good creditors turnover ratio. This figure shows how often you pay a trade creditor in a given time period. The formula is Creditors Turnover Ratio = (Total Credit Purchases – Purchase Returns)/((Beginning Trade Accou...
What is trade payables settlement period? The trade payables' payment period ratio representsthe time lag between a credit purchase and making payment to the supplier. ... In addition, the trade payables payment period is compared with the trade receivable collection period to compare the pace of...