Resolved: Payables Turnover
In Practice Exam 1 in Question 6, when trying to solve for "DPO" and before that "Payables Turnover", how did you find the "Purchases" value as 2637 from the income statement to put in the numerator for "Payables Turnover"?
1 answers ( 0 marked as helpful)
Hi Nadir,
thank you for this question, we will update the explanation shortly.
You can find the Purchases* amount using the following formula:
*Purchases = Closing inventory balance – Opening inventory balance + COGS = $409 – $482 + $2,710 = $2,637
I hope this helps.
Best,
The 365 Team