Days sales outstanding and Department for International Trade: Difference between pages

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(Link with Free trade page.)
 
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(DSO). 
''UK government’’


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.
(DIT).


UK international economic department, responsible for:


<span style="color:#4B0082">'''Example 1'''</span>
* policy, promotion and expertise to encourage free trade.


Accounts receivable = EUR 50m.
* delivering a trade policy framework for the UK on leaving the European Union.


Daily credit sales = EUR 2m.
* promoting British trade and investment.




Then Days sales outstanding:
==See also==
* [[ECGD]]
* [[European Union]]
* [[Free trade]]
* [[Trade finance]]


= 50 / 2


= 25 days.
== External link ==
 
[https://www.gov.uk/government/organisations/department-for-international-trade Department for International Trade home page]
Based on <u>annual</u> 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).
 
 
<span style="color:#4B0082">'''Example 2'''</span>
 
Annual credit sales = EUR 730m.
 
Accounts receivable = EUR 50m.
 
 
Then Days sales outstanding:  
 
= (50 / 730)  x  365
 
= 25 days (as before).
 
 
A lower result is generally considered desirable, although the business needs to ensure it does not put itself at a competitive disadvantage to other businesses which offer easier credit terms to customers.
 
 
DSO is also sometimes known as Days billing outstanding (DBO) or Days receivables outstanding (DRO).
 
 
== See also ==
* [[Credit]]
* [[Debtor days]]
* [[Ratio analysis]]
 
[[Category:Manage_risks]]
[[Category:Financial_products_and_markets]]

Revision as of 06:03, 3 November 2017

UK government’’

(DIT).

UK international economic department, responsible for:

  • policy, promotion and expertise to encourage free trade.
  • delivering a trade policy framework for the UK on leaving the European Union.
  • promoting British trade and investment.


See also


External link

Department for International Trade home page