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Account Receivables Turnover Days

oboloo Glossary

Account Receivables Turnover Days

Account Receivables Turnover Days is a business metric that measures the average number of days it takes for a company to collect payments from customers. It’s an important measure of financial health, as it shows how quickly and efficiently the company is collecting its receivables. Put simply, the lower the turnover days, the better – as this means customers are paying you promptly and efficiently. To calculate your Accounts Receivables Turnover Days, divide your total accounts receivable by your Sales during the given period, and then multiply that number by the number of days in the period. This will give you a figure that represents the average time it takes you to collect your outstanding invoices.

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