Understanding Payment Terms

If there is a period of time between when your customers receive your goods or services and when they pay for them, then several things are true: You have a balance in Accounts Receivable on your balance sheet that represents how much customers owe you You have an...

What’s Your DSO?

If you grant credit to customers, then you have a balance in accounts receivable. DSO stands for Days Sales Outstanding, and this helps you measure how fast your receivables are being converted to cash. Here’s how to calculate it: DSO = Accounts receivable balance /...