AP Calculation accounts, average, always, period

aurific

I always thought AP turnover is calculated using total purchases for the period over average accounts payable. In one of the mock's solutions, it shows that COGS is divided by average accounts payable to get the AP turnover. Anyone?

agulani

I noticed that too, I guess when you don't have the purchases, you put COGS.

ramdabom

Yeah, even I went wrong in that question. But then, I thought that the question was a tricky one as you could solve for purchases through the equation:
opening stock + purchases - ending inventory = COGS
the question did mention about the other three. So I solved for purchases and got an answer that was not among the options. So I picked an opton close to my calculated answer and got it wrong.
And now I have prepared mentally for using COGS if a question comes up on te exam. I hate CFAI and yes, I'm not violating any standard by saying so.

thisisbrianly

areyouserious Wrote:
-------------------------------------------------------
> Yeah, even I went wrong in that question. But
> then, I thought that the question was a tricky one
> as you could solve for purchases through the
> equation:
> opening stock + purchases - ending inventory =
> COGS
> the question did mention about the other three. So
> I solved for purchases and got an answer that was
> not among the options. So I picked an opton close
> to my calculated answer and got it wrong.
> And now I have prepared mentally for using COGS if
> a question comes up on te exam. I hate CFAI and
> yes, I'm not violating any standard by saying so.

Agree... you should use purchases of course

One day in the future this question will come up in the exam and they will say: which of both Areyouserious or Omar violated the standard and the answer will be none