# Days payable outstanding

﻿
Days payable outstanding

Days payable outstanding (DPO) is an efficiency ratio that measures the average number of days a company takes to pay its suppliers.

The formula for DPO is:

$DPO = \dfrac{ending~A/P}{COGS/day}$

where ending A/P is the accounts payable balance at the end of the accounting period being considered and COGS/day is calculated by dividing the total cost of goods sold per year by 365 days.[1]

## Notes

1. ^ Berman, K., Knight, J., Case, J.: Financial Intelligence for Entrepreneurs, page 151. Harvard Business Press, 2008.

Wikimedia Foundation. 2010.

### Look at other dictionaries:

• Days Payable Outstanding - DPO — A company s average payable period. Calculated as: Notice that the formula may also be written as: accounts payable / (cost of sales/number of days). DPO is an indicator of how long a company is taking to pay its trade creditors. DPO is typically …   Investment dictionary

• Days sales outstanding — In accountancy, Days Sales Outstanding (also called Days Receivables) is a calculation used by a company to estimate their average collection period. A low number of days indicates that the company collects its outstanding receivables quickly.… …   Wikipedia

• Days sales outstanding ratio — DSO ratio, or days sales outstanding ratio, or days sales outstanding ratio, is a financial ratio that illustrates how well a company s accounts receivables are being managed. A DSO ratio can be expressed as: DSO ratio = accounts receivable /… …   Wikipedia

• Days in inventory — Days in inventory(DII) is an efficiency ratio that measures the average number of days the company holds its inventory before selling it. The formula for DII is: where the average inventory is the average of inventory levels at the beginning and… …   Wikipedia

• Days Sales Of Inventory - DSI — A financial measure of a company s performance that gives investors an idea of how long it takes a company to turn its inventory (including goods that are work in progress, if applicable) into sales. Generally, the lower (shorter) the DSI the… …   Investment dictionary

• Accounts payable — Accountancy Key concepts Accountant · Accounting period · Bookkeeping · Cash and accrual basis · Cash flow management · Chart of accounts  …   Wikipedia

• Cash Conversion Cycle - CCC — A metric that expresses the length of time, in days, that it takes for a company to convert resource inputs into cash flows. The cash conversion cycle attempts to measure the amount of time each net input dollar is tied up in the production and… …   Investment dictionary

• DPO — Direct Public Offering (Business » Stock Exchange) Days Past Ovulation (Medical » Physiology) * Days Post Ovulation (Medical » Physiology) * Discontinued Post Office (Miscellaneous » USPS) * District Police Officer (Governmental » Police) * Days… …   Abbreviations dictionary

• United Kingdom — a kingdom in NW Europe, consisting of Great Britain and Northern Ireland: formerly comprising Great Britain and Ireland 1801 1922. 58,610,182; 94,242 sq. mi. (244,100 sq. km). Cap.: London. Abbr.: U.K. Official name, United Kingdom of Great… …   Universalium

• china — /chuy neuh/, n. 1. a translucent ceramic material, biscuit fired at a high temperature, its glaze fired at a low temperature. 2. any porcelain ware. 3. plates, cups, saucers, etc., collectively. 4. figurines made of porcelain or ceramic material …   Universalium