3290. If credit sales for the year is Rs 5,40,000 and Debtors at the end of year is Rs 90,000 the Average Collection Period will be

✅ The correct answer is B.
Rs. 540000 divided by Rs. 90,000 = 6 times per year. Since there were 365 days during the recent year, the average collection period is 365 days divided by the turnover ratio of 6 = 60.8333 days or 61 days.