Tortoise, Inc., had a cost of goods sold of $44,021. At the end of the year, the

Question

Tortoise, Inc., had a cost of goods sold of $44,021. At the end of the year, the accounts payable balance was $8,043. How long on average did it take the company to pay off its suppliers during the year? (Use 365 days a year. Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Tortoise, Inc., had a cost of goods sold of $44,021. At the end of the year, the accounts payable balance was $8,043. How long on average did it take the company to pay off its suppliers during the year? (Use 365 days a year. Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Explanation / Answer

payable turnover = COGS/account payable balance = 44021/8043 = 5.47

number of payable days = 365/payable turnover = 365/5.47 = 66.69 days

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