Days payables outstanding - Revision history

imported>Doug Williamson: Correct spelling.

2019-02-06T11:16:01Z

Correct spelling.

← Older revision		Revision as of 11:16, 6 February 2019
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	A higher number is generally perceived as better, but a business needs to maintain the goodwill of its suppliers and a shorter payment terms may therefore be necessary.		A higher number is generally perceived as better, but a business needs to maintain the goodwill of its suppliers and shorter payment terms may therefore be necessary.

imported>Doug Williamson: Layout.

2019-02-03T18:24:30Z

Layout.

← Older revision		Revision as of 18:24, 3 February 2019
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	The DPO is:		The DPO is:

	50,000 / 400,000 * 365 = 45.6 days		(50,000 / 400,000) x 365

			= 45.6 days

imported>Doug Williamson: Correct 2nd sentence typo.

2019-02-03T18:22:03Z

Correct 2nd sentence typo.

← Older revision		Revision as of 18:22, 3 February 2019
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	Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.		Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.

	~~Payables days~~ measures the average number of days taken to pay trade suppliers.		DPO measures the average number of days taken to pay trade suppliers.

imported>Doug Williamson: Expand definition.

2019-02-03T18:17:32Z

Expand definition.

← Older revision		Revision as of 18:17, 3 February 2019
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	Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.		Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.

			Payables days measures the average number of days taken to pay trade suppliers.


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	Also known as Creditor days.		Also known as Creditor days or Payables days.

imported>Doug Williamson: Add example.

2019-02-03T16:41:10Z

Add example.

← Older revision		Revision as of 16:41, 3 February 2019
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	Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.		Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.



			For example: a company has an average of £50,000 of payables over a year in which the cost of goods sold was £400,000.

			The DPO is:

			50,000 / 400,000 * 365 = 45.6 days


			A higher number is generally perceived as better, but a business needs to maintain the goodwill of its suppliers and a shorter payment terms may therefore be necessary.


	Also known as Creditor days.		Also known as Creditor days.

imported>Doug Williamson: Create page. Source: DPO page.

2019-02-03T16:37:17Z

Create page. Source: DPO page.

New page

''Financial ratio analysis - management efficiency ratios.''

(DPO).

Days payables outstanding are a working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period.

Also known as Creditor days.

== See also ==
* [[Creditors]]
* [[Debtor days]]
* [[Management efficiency ratio]]
* [[Payables management]]

[[Category:Accounting,_tax_and_regulation]]
[[Category:The_business_context]]