Formula to
calculate accounts payable turnover
ratio:
Accounts Payable Turnover Ratio
= total supplier purchases / average accounts payable
Accounts Payable Turnover Ratio definition and explanation:
The accounts payable
turnover ratio shows the number of times that
accounts payable are paid throughout the year.
A falling accounts payable
turnover ratio indicates that the company is
taking longer to pay its suppliers.
The accounts payable
turnover ratio is listed in our liquidity
ratios
and
turnover ratios.
Spreadsheets to
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explanations and charts):
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