3.6 Efficiency ratio analysis
Efficiency ratios
Inventory (stock) turnover ratio:
Debtor days (days’ sales in trade receivables) ratio = Debtors (accounts receivable) x 365 / revenue
Creditor days (days in trade payables) ratio:
Gearing ratio:
Inventory (stock) turnover ratio:
Debtor days (days’ sales in trade receivables) ratio = Debtors (accounts receivable) x 365 / revenue
Creditor days (days in trade payables) ratio:
Gearing ratio: