Read the formula and its variables
Use the selected sales convention for the same period as the receivable average.
| Input | Meaning |
|---|---|
| n | Period day count |
| Average AR | Average receivables |
| S | Positive matching sales base |
Inspect a stated example
With n = 365, receivables 60 and sales base 500, DSO is 43.8 days.
The illustrative inputs are not an actual issuer’s data. Match balance coverage, flow period and units before applying the formula.
Keep the conclusion within the evidence
The result does not establish an individual invoice’s due date or collection date. Label proxies and coverage.
A ratio change can motivate a further question. It does not automatically identify the transaction, risk or operational outcome that produced it.