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Working capital practice question

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Working capital practice question

  • This topic has 1 reply, 2 voices, and was last updated 8 years ago by John Moffat.
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  • January 14, 2017 at 8:13 pm #366529
    Candy
    Member
    • Topics: 135
    • Replies: 79
    • ☆☆☆

    Dear John,

    I came across a practice question that took inventory days as a value of cost of sales value of £15m same as payable days, and not £27m as trade receivables?

    I thought inventory was a current asset and should have been treated the same as receivables days not payable days?

    I hope I have explained well enough

    Many thanks

    January 15, 2017 at 7:33 am #366613
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54804
    • ☆☆☆☆☆

    Inventory is certainly an asset.

    However, it is valued at cost whereas receivables are valued at selling price.

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