Will there be any impact on a company's profit if company changes it's debtors terms from 15 to 30 days, with no expected change in sales revenue?

ACCOUNTS payable turnover is a ratio that measures the speed with which a company pays its suppliers. If the turnover ratio declines from one period to the next, this indicates that the company is paying its suppliers more slowly, and may be an indicator of worsening financial condition.payable turnover is a ratio that measures the speed with which a company pays its suppliers. If the turnover ratio declines from one period to the next, this indicates that the company is paying its suppliers more slowly, and may be an indicator of worsening financial condition.

Dear Mrs. Ahmad,

increasing clients period payment with no expected change in sales revenue will affect negatively the profit of the company, the financial charges will increase in time.

"A Dollar today worth more than a dollar tomorrow, the time value of money"

Regards,

The measure will affect the liquidity in the company's weakened but probably will increase sales in the case of increasing the number of customers, especially in the case of weak demand for commodity company

Increasing debtors payment period is key to increase profits, in markets where there are liquidity challenges, cash sales are low this enhances increased credit sales. Increasing the payment period enhances competitiveness and increased sales, this increases profits and has a positive impact on sales volumes.