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Receivables Collection Days & Turnover

Estimate average collection days from net credit sales and receivables, or from a turnover ratio, with a transparent credit-term comparison.

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Calculator inputs

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How to use this calculator

  1. Enter the known values in the units shown. Results update as you type.
  2. Where results are editable, change one to solve backwards. Lock a value to hold it fixed.
  3. Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

Average receivables of 30,000 against 365,000 of net credit sales over 365 days give a 30-day collection period. Beginning and ending receivables of 20,000 and 40,000 produce that average.

Collection days = average receivables × period days / net credit sales = period days / turnover

Worked example

Enter these known values and leave the other values blank.

Beginning accounts receivable
20000 USD
Ending accounts receivable
40000 USD
Net credit sales over the period
365000 USD
Duration
365 days
Credit term used for comparison
30 days
Average accounts receivable
30000 USD
Average collection period
30 days

Assumptions and limitations

  • Receivables and net credit sales must describe the same period and use one consistent currency. Cash sales are excluded.
  • The two-balance average is the arithmetic mean of beginning and ending receivables; it can differ from a daily or monthly weighted average.
  • This paired days-and-turnover model requires positive average receivables, credit sales and duration. Turnover is undefined when average receivables are zero.
  • Conditional comparison notes retain the source band at four thirds of the credit term, but this is only a heuristic. No universal acceptable collection period is inferred.
  • The result is an aggregate ratio, not the observed age of each invoice or a forecast of when a particular customer will pay.

Common questions

Can I enter the average balance directly?

Yes. Supply the average receivables figure, net credit sales and duration; the beginning and ending balances are optional ways to obtain that average.

References

Bookify requires positive average receivables and net credit sales for the paired collection-days and turnover model, and nonnegative opening and closing balances.

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