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  3. 2. b m reid's books of account showed the followin

2. B M Reid's books of account showed the following figures for the year ended...

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Accounting

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2. B M Reid's books of account showed the following figures for the year ended 31 December 2012: Revenue 200 000 Ordinary goods purchased 145 000 Profit from operations 22 500 Reid's balances at 31 December 2012 were: Inventory 12 500 Trade receivables 40 000 Cash and cash equivalents 10 000 Trade payables 25 000 Finance costs (interest owing) 12 500 Non-current assets at net book value 60 000 Additional information: 1 80% of revenue was on credit 2 Inventory at 1 January 2012 was $17 500 3 Trade payables and trade receivables balances were unchanged since 1 January 2012 For the year ended 31 December 2011 the following ratios were: Inventory turnover 13 times Trade receivables turnover 70 days 80% of revenue earned is on credit Inventory on the 1* of Jan 2012 is $17500 The balance of the payables and receivables remain unchanged. Compare the results and state possible reasons for the change

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