Enter the total number of days of a collection period, the total net receivables, and total net credit sales into the calculator. The calculator will determine the average collection period.

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## Average Collection Period Formula

The follow equation is used to calculate the average collection period.

ACP = D× NR / NCS

- Where ACP is the average collection period
- D is the total number of days
- NR is the average net receivables
- NCS is the net credit sales

## Average Collection Period Definition

An average collection period is the average time it would take for the net receivables to be equal to the net credit sales.

## Average Collection Period Example

How to calculate average collection period?

**First, determine the total number of days.**This is the total number of days of the period.

**Next, determine the average net receivables.**Calculate the average net receivables over the time period.

**Next, determine the net credit sales.**Measure the net credit sales of the same time period.

**Finally, calculate the average collection period.**Using the formula above, calculate the average collection period.

## FAQ

**What is an average collection period?**

An average collection period is the average amount of days it takes for net credit sales to equal the net receivables.