Days sales outstanding: Difference between revisions
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For example given annual credit sales = EUR 730m (and accounts receivable = EUR 50m as before): | For example given annual credit sales = EUR 730m (and accounts receivable = EUR 50m as before): | ||
Days sales outstanding = EUR 50m/EUR 730m x 365 days | Days sales outstanding = EUR 50m/EUR 730m x 365 days | ||
= 25 days (as before). | |||
Also known as Days billing outstanding (DBO) or Days receivables outstanding (DRO). | Also known as Days billing outstanding (DBO) or Days receivables outstanding (DRO). | ||
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* [[Debtor days]] | * [[Debtor days]] | ||
* [[Ratio analysis]] | * [[Ratio analysis]] | ||
Revision as of 14:01, 28 May 2013
(DSO). A credit measurement ratio calculated by dividing accounts receivable outstanding at the end of time period by the average daily credit sales for the period.
For example, if accounts receivable = EUR 50m; and Daily credit sales = EUR 2m
Then Days sales outstanding = EUR 50m/EUR 2m = 25 days.
Based on annual total sales - or total sales for any other period - the calculation is modified appropriately for the length of the time period in days (for example 365 days per year).
For example given annual credit sales = EUR 730m (and accounts receivable = EUR 50m as before): Days sales outstanding = EUR 50m/EUR 730m x 365 days
= 25 days (as before).
Also known as Days billing outstanding (DBO) or Days receivables outstanding (DRO).
