Lesson Plan

• Describe the purpose of trade receivables turnover and the days‑outstanding measure.
• Calculate average trade receivables, the turnover ratio, and the corresponding days using the standard formulas.
• Interpret the results in terms of credit control, cash‑flow impact and industry benchmarks.
• Analyse trends over periods and recognise common calculation pitfalls.

• Projector / interactive whiteboard
• Printed worksheet with sample published accounts
• Calculators or spreadsheet software
• Formula reference sheet (turnover & days)
• Whiteboard and markers
• Worked‑example handout

Begin with the question, “How many days do you think it takes a typical retailer to collect the money it is owed?” Capture a few guesses, then link to the concept of trade receivables turnover. Review that students already know how to read income statements and balance sheets, and state that by the end of the lesson they will be able to calculate and interpret the turnover days accurately.

1. Do‑now (5'): Students write an estimated collection period for a well‑known retailer; share responses.
2. Mini‑lecture (10'): Present the two formulas, explain net credit sales vs total sales, and illustrate with a quick diagram.
3. Guided calculation (12'): Walk through the provided XYZ example, filling in each step on the board.
4. Pair activity (10'): Learners use a new data set on the worksheet to compute average receivables, turnover, and days, then draft a brief interpretation.
5. Class discussion (8'): Groups compare results, discuss industry benchmarks and highlight common pitfalls (e.g., using total sales).
6. Exam checklist recap (5'): Students list the four checklist items on sticky notes and display them for a quick review.

Summarise the calculation flow from net credit sales to turnover days and reinforce why the measure matters for cash‑flow management. Ask each student to write one “exit ticket” sentence stating one insight they will apply in future exam questions. For homework, assign a short problem set requiring calculation and interpretation of turnover for two different industries.