Enter the total accounts receivable, net sales, and number of days into the calculator to determine the days sales outstanding.

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## Days Sales Outstanding Formula

The following equation can be used to calculate the days sales outstanding.

DSO = AR / (NS / #D)

- Where DSO is the days sales outstanding
- AR is the accounts receivable
- NS is the net sales
- #D is the number of days

## Days Sales Outstanding Definition

Days sales outstanding, or DSO for short, is the average number of days it takes a company to receive payment on sold goods. Since companies typically have certain payment terms with clients, this is often 30+ days.

## Days Sales Outstanding Example

How to calculate days sales outstanding?

**First, determine the total number of days.**Determine the total time period being analyzed in days.

**Next, determine the total accounts receivable.**Calculate the total accounts receivable during the time period.

**Next, determine the total net sales.**Calculate the total net sales during the time period.

**Finally, calculate the DSO.**Calculate the days sales outstanding using the formula above.

## FAQ

**What are days sales outstanding?**

The days sales outstanding are the average number of days it takes for a company to receive money on sales.

**What is a good days sales outstanding?**

Typically, for credit based business, 30 days is a good time frame to shoot for.

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