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What's the meaning DSO (Days Sales Outstanding) , and how to calculate it ?

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Question added by Ahmed Taha - CMA - IFRS , Financial Controller , National Gas & Industrialization Co. (GASCO)
Date Posted: 2014/04/14
Anil Chauhan
by Anil Chauhan , Senior Accountant , DOTW KUWAIT WLL

Days sale outstanding means , the sale which is sold on credit and is not collected , for example , if your company is having a credit terms of Days  for the date of Invoice , than it is  not yet due  for the collection from of the Month if  you have Invoiced to the customer on every first of the month afterth day  you sale become overdue and will be called as days sales outstanding .

 

Will be calculated as  Avg Credit sales/Credit sales x

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