How to Calculate Days Sales Outstanding

How to Calculate Days Sales Outstanding

Accutrac Capital 0 Comments

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Calculating Days Sales Outstanding (DSO) also known as accounts receivable turnover is vital in determining the financial health of your company. It is a measure of how fast your customers pay your invoices. Calculating DSO (accounts receivable turnover) is a simple equation that should be performed at least once a quarter. 

Maintaining sufficient cash flow to pay expenses is critical to your companys financial health. Day Sales Outstanding is a critical element in the calculation to forecast your cash flow.

Calculating Days of Sales Outstanding:

  1. Know the math: Calculating DSO, a simple equation that shows your average number of days your receivables are outstanding.
  2. Monitor the numbers: The speed with which your trucking company converts invoices into cash can have a tremendous impact on your business. Track the DSO frequently on a trend line and keep it in your comfort zone.
  3. When your DSO rises above your comfort zone a growing number of trucking companies are turning to Invoice Factoring to improve cash flow.

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Benefits of Invoice Factoring Include:

  • Accurate & efficient Accounts Receivable Management
  • Free credit reports
  • Secure online access to view your account, 24/7
  • Regular and easy to understand reporting to monitor the status of your account

To learn more about Invoice Factoring contact Accutrac Capital today. Let us help you stay in your 'cash flow' comfort zone!


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