Days Sales Outstanding in Accounts Receivable

Home » CMA Glossary Term » Ratios and Performance Metrics » Days Sales Outstanding in Accounts Receivable

Days Sales Outstanding (DSO) in Accounts Receivable, also known as “days in sales receivables,” is a financial metric that measures the average number of days it takes a company to collect payment after a sale has been made. It is a critical indicator of a company’s liquidity and efficiency in managing its receivables. A lower DSO suggests quicker collections, enhancing cash flow.

CMA Exam Academy 16-Week Accelerator Program