The formula for Days Sales Outstanding (DSO) is calculated by dividing the average accounts receivable by total credit sales and then multiplying the result by the number of days in the period. It measures the average number of days it takes for a company to collect payments from its customers after making a sale. A lower DSO indicates faster cash conversion and efficient credit management, while a higher DSO may suggest delayed payments and potential cash flow challenges.
Reimagine Your Order-To-Cash with AI
Touchless Receivables. Frictionless Payments.
Recommended Digital Assets for You
Suggested Resources
Data-Driven Finance for Achieving Excellence in Order-to-Cash Operations
Digital Order-to-Cash: A Roadmap to Collections Automation (Part 2 – Keeping the Customer and Maximizing Cash Flow)
World-class Digital Order-To-Cash: Transforming Accounts Receivables For the New Normal
Digital Credit: Onboarding the Customer
Add AI to Your Order-to-Cash Process
AR Automation for JD EDwards
AR Automation for SAP
AR Automation for Oracle
AR Automation for NetSuite
AR Automation for PeopleSoft
