The Average Account Receivable formula is a key metric in financial accounting that measures the average amount of money owed to a company by its customers. This figure can give you an insight into how effective your debt collection process is and how long it’s taking you to collect payment from customers. By understanding this important figure, you can make better decisions about how to manage debtors, improve cash flow and maximize profitability. With these crucial insights, your business can continue growing and succeed in the competitive business landscape.