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Hi, in this BPP REVISION KIT sum the inventory, trade receivables and trade payables for next year are calculated using the closing balance method and not average.Eg: inventory turnover period= average inventory×365/cost of sales I.e. 110= (2.4+x/2)×365/12.141 but in the solution it is 110=x×365/12.141. Why should we not take average inventory? The orginal formulae is also based on average inventory.
Thanks in advance.The only question called APX that I know of was a Paper P5 exam question.
Are you sure you are asking about a Paper F5 question, because there is no question called APX in the current edition of the BPP Paper F5 Revision Kit.
If you are really asking about P5 then you need to ask in the P5 Ask the Tutor Forum and the P5 tutor will help you.
It is there in the BPP F5 REVISION KIT of earlier version APX CO. (12/09, amended).
I have in front of me the current edition of the F5 BPP Revision Kit, and I cannot find a question called APX in it.
I have however found the question you are referring to – it was in the real Paper F9 exam in December 2009 (not F5) 🙂
Although you would not lose marks for doing what you want to do, you will know from our free lectures that normally we use year-end figures to calculate the various ratios (even though strictly speaking using averages might give more meaningful results).
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