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O-Level Judging efficiency of inventory and trade receivables management

What the O-Level syllabus expects for Judging efficiency of inventory and trade receivables management, and how to practise it.

What the syllabus expects

• Explain why running inventory and trade receivables efficiently matters
• Break down, over as many as three years or against a rival business, the balances for credit service fee revenue, net credit sales revenue, cost of sales, inventory and trade receivables
• Read what the balances for net credit service fee revenue, net credit sales revenue, trade receivables, inventory and cost of sales reveal over as many as three financial years
• Judge a business's efficiency from how the trend across credit service fee revenue, net credit sales revenue, cost of sales, inventory and trade receivables develops over as many as three years
• Name and compute two inventory measures: days sales in inventory (days) and the rate of inventory turnover (times)
• Name and compute two collection measures: the trade receivables collection period (days) and the rate of trade receivables turnover (times)
• Read what days sales in inventory (days) and the rate of inventory turnover (times) mean over as many as three years or against a single rival business
• Read what the trade receivables collection period (days) and the rate of trade receivables turnover (times) mean over as many as three years or beside a rival business
• Judge how well inventory is managed from the trend in days sales in inventory (days) or the rate of inventory turnover (times) over as many as three years or against a single rival business
• Judge how well debts are collected from the trend in the trade receivables collection period (days) and the rate of trade receivables turnover (times) over as many as three years or versus a rival business
• Suggest ways to improve either days sales in inventory (days) or the rate of inventory turnover
• Suggest ways to improve the trade receivables collection period (days) alongside the rate of trade receivables turnover (times)

More O-Level Principles of Accounts topics

Roles of accounting and of accountants · Stakeholders and what they need in order to decide · Judging profitability · Judging liquidity · Kinds of business · Forms of business ownership · all of O-Level Principles of Accounts