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Days Sales Outstanding (DSO) measures the average number of days a company takes to collect payment after making a sale. A lower DSO means faster cash collection; a high DSO can signal collection problems or overly generous credit terms.
ଷ୍ଟେପ୍-ଷ୍ଟେପ୍ ଗାଇଡ୍ |
- 1Get accounts receivable balance from the balance sheet
- 2Get total revenue for the period (usually annual)
- 3DSO = (Accounts receivable / Revenue) × Number of days in period
- 4For monthly: DSO = AR / (Revenue / 30)
ସମାଧାନ ହୋଇଥିବା ଉଦାହରଣ
ଇନପୁଟ୍
AR £150k · Annual revenue £1.8M
ଫଳ
DSO = 30 days
(150k/1.8M) × 365 = 30 days