

Formula to Calculate A/R DaysĪRD = (Accounts Receivable / Total Sales) x Number of Days Example of A/R Days To calculate ARD, businesses divide their total Accounts Receivable (AR) by their total sales and then multiply the result by the number of days in the period being measured (usually a year). It is an important metric for businesses because it reflects how efficiently they manage their cash flow and collect payments from customers.
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Use of Financial Ratios to Track Changes in Account Receivable DaysĬlick here for free trial What are Account Receivable Days?Īccount Receivable Days (ARD) is a financial metric that measures the average number of days it takes for a business to collect payment from its customers for goods or services that have been delivered but not yet paid for.

Monitoring and Measuring Account Receivable Days.Effective Billing and Payment Collection Strategies.Strategies for Improving Account Receivable Days.Impact of Poor Account Receivable Days Management on Customer Relationships.Impact of Extended Account Receivable Days on Cash Flow.

