Asked by Areeba Zahir on Feb 18, 2024
Verified
Describe DSO.
Accounts Receivable
Money owed to the company for goods or services provided and billed to a customer.
- Analyzing the importance of DSO in financial management
- Identifying the factors that affect DSO
- Understanding the concept of DSO (Days Sales Outstanding)
Verified Answer
CB
carlee burnsideFeb 18, 2024
Final Answer :
DSO is a measure of the number of days that it takes to collect on accounts receivable.Remember,if you do business in cash,then your DSO is zero,but if you sell on credit,then this will be a positive number.DSO is calculated using the following equation: DSO = Average Accounts Receivable/Revenue per day Average Accounts Receivable = (Beginning Accounts Receivable + Ending Accounts Receivable)/2 Revenue per day = Revenue/365
Learning Objectives
- Analyzing the importance of DSO in financial management
- Identifying the factors that affect DSO
- Understanding the concept of DSO (Days Sales Outstanding)
Related questions
Suppose a Firm Has Seasonal Sales and Customers That All ...
Which Statement Best Describes DSO and Aging ...
The Primary Reason to Monitor Aggregate Accounts Receivable Is to ...
The Average Collection Period Is Calculated by Dividing Total Sales ...
Describe How to Calculate CCC (Cash Conversion Cycle)