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Days Sales Outstanding (DSO) Calculator

Measure how efficiently your company converts credit sales into cash

Understanding DSO
The key to efficient cash flow management

Days Sales Outstanding (DSO) measures how efficiently and quickly a company converts credit sales into cash and how much credit sales are tied up unproductively as accounts receivable.

The Formula:

DSO = (Average Accounts Receivable / Net Credit Sales) × Number of Days

A lower DSO indicates greater efficiency, as less cash remains tied up in accounts receivable. Generally, a DSO greater than 30% of standard payment terms deserves collection action.

Why DSO matters:

  • Indicates efficiency of accounts receivable management
  • Tracks changes in credit sales quality
  • Identifies cash flow that could be used for operations or growth
  • Helps detect potential collection issues early
Calculate Your DSO
Enter your financial data to calculate your DSO
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Enter the total accounts receivable at the beginning of your measurement period.

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Enter the total accounts receivable at the end of your measurement period.

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Enter your total net sales (credit sales) for the period.

Enter the number of days in your measurement period (e.g., 365 for a year, 90 for a quarter).

This calculator is provided for informational purposes only and should not be considered financial advice.