⚡Efficiency Ratios
Days Sales Outstanding (DSO)
365 ÷ Accounts Receivable Turnover = Days Sales Outstanding
What It Means
Average days to collect payment from customers.
Example
A/R Turnover:12
365 ÷ 12
DSO = 30.4 days
→ Customers pay in about 30 days on average
Related Formulas
Inventory Turnover
Cost of Goods Sold ÷ Average Inventory = Inventory Turnover
Days Sales in Inventory
365 ÷ Inventory Turnover = Days Sales in Inventory
Accounts Receivable Turnover
Net Credit Sales ÷ Average Accounts Receivable = A/R Turnover
Asset Turnover
Net Sales ÷ Average Total Assets = Asset Turnover
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