Ask Question
BusinessBusiness
17 November, 20:12

The main reason that a firm would strive to reduce the number of days sales outstanding is to increase is?

+4
Answers (1)
  1. 17 November, 23:35
    0
    Cash flow

    Explanation:

    Days sales outstanding (DSO) is the average number of days (from the day sales were made) it takes for an entity to collect cash from credit or receivable customers. It is a financial ratio that is used generally to measure

    how an entity is able to manage its account receivable and improve cash flow. The formula for the calculation of DSO is:

    (Accounts Receivable / Net Credit Sales) x 365

    Apart from the lost of interest on deposit associated with high DSO, entities will enjoy the advantage of increase cash flow when they are able to drive down their days sales outstanding (DSO)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The main reason that a firm would strive to reduce the number of days sales outstanding is to increase is? ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
On March 1, 2020, Pronghorn Company sold goods to Goosen Inc. for $600,000 in exchange for a 5-year, zero-interest-bearing note in the face amount of $923,174 (an inputed rate of 9%). The goods have an inventory cost on Pronghorn's books of $368,000.
Answers (1)
In marketing children's products, it's extremely important to produce television commercials that hold the attention of the children who view them.
Answers (1)
The cash flows below contain the year 1 cash flows for a potential real estate investment. What is the property's operating expense ratio?
Answers (1)
Roger has been lifting weights seriously for years. his twin brother steven does not exercise regularly.
Answers (1)
Banks are able to create money only when a. interest rates are above 2%. b. the fed sells u. s. government bonds. c. the reserve ratio is 100%. d. only a fraction of deposits are held in reserve.
Answers (1)
New Questions in Business
One characteristic many successful entrepreneurs share includes
Answers (1)
Which statement is true? A diverse workplace can cause people to become prejudiced. Cultural barriers can pose a challenge to creating a diverse workplace. Enforcing the use of English reduces challenges in creating a diverse workplace.
Answers (1)
The costs of materials consumed in producing good units in the Production Department of Jacobs Company were $38,000 and $39,125 for June and July, respectively.
Answers (1)
How would small business owners apply this concepts to maximize his or her wealth?
Answers (1)
One difference between total utility and marginal utility is that
Answers (1)
Home » Business » The main reason that a firm would strive to reduce the number of days sales outstanding is to increase is?
Sign Up Forgot Password?