DSO Calculator (Days Sales Outstanding)
Divide receivables by revenue and multiply by the days in the period. On 500,000,000 of yearly revenue with 82,000,000 outstanding, DSO is 59.9 days — cash arrives about two months after the goods do. That 82,000,000 is your money sitting in someone else's account, and at a 6% funding rate it costs 4,920,000 a year to leave it there. With revenue running at 1,369,863 a day, collecting ten days sooner releases 13,698,630 in one go.
Your numbers
Days sales outstanding
59.9d
Revenue a day
1,369,863
Yearly funding cost
4,920,000
Cash from ten days
13,698,630
Formula
Days sales outstanding = Receivables ÷ Revenue × Days in term
Use 365 days with a year of revenue and 90 with a quarter of it — mixing them puts the answer out by four times. Seasonal sales make a period-end DSO read long or short against reality, and dividing a tax-inclusive invoice balance by tax-exclusive revenue stretches DSO by the tax rate.
What to enter
| Input | Default | Accepted range |
|---|---|---|
| RevenueEverything sold in the period; settle first whether tax and discounts are out. | 500,000,000 | 0 and up |
| ReceivablesMoney billed but not yet collected — your cash in someone else's account. | 82,000,000 | 0 and up |
| Days in term (d)The full length of the contract or pass. | 365 | 1 ~ 366 |
| Annual rate (%)Interest quoted per year; the monthly rate is this over 12. | 6 | 0 ~ 40 |
Step by step
Quick reference table
Results when only Revenue changes and everything else stays put.
| Revenue | Days sales outstanding (d) | Revenue a day | Yearly funding cost |
|---|---|---|---|
| 250,000,000 | 119.7 | 684,932 | 4,920,000 |
| 375,000,000 | 79.8 | 1,027,397 | 4,920,000 |
| 500,000,000 | 59.9 | 1,369,863 | 4,920,000 |
| 750,000,000 | 39.9 | 2,054,795 | 4,920,000 |
| 1,000,000,000 | 29.9 | 2,739,726 | 4,920,000 |
What each result means
| Result | At default values |
|---|---|
| Days sales outstanding (d)Average days to collect; the days-in-period you chose drives it. | 59.9 |
| Revenue a dayRevenue over the days in the period — it converts collection days into money. | 1,369,863 |
| Yearly funding costWhat it costs each year to leave that uncollected balance where it is. | 4,920,000 |
| Cash from ten daysThe cash released in one go by collecting ten days sooner. | 13,698,630 |
Common mistakes
Use 365 days with a year of revenue and 90 with a quarter of it — mixing them puts the answer out by four times. Seasonal sales make a period-end DSO read long or short against reality, and dividing a tax-inclusive invoice balance by tax-exclusive revenue stretches DSO by the tax rate.
Glossary
- Revenue
- Everything sold in the period; settle first whether tax and discounts are out.
- Receivables
- Money billed but not yet collected — your cash in someone else's account.
- Days in term
- The full length of the contract or pass.
- Annual rate
- Interest quoted per year; the monthly rate is this over 12.
- Days sales outstanding
- Average days to collect; the days-in-period you chose drives it.
- Revenue a day
- Revenue over the days in the period — it converts collection days into money.
- Yearly funding cost
- What it costs each year to leave that uncollected balance where it is.
- Cash from ten days
- The cash released in one go by collecting ten days sooner.
Frequently asked questions
Q. How is DSO Calculator (Days Sales Outstanding) calculated?
Days sales outstanding = Receivables ÷ Revenue × Days in term — Divide receivables by revenue and multiply by the days in the period. On 500,000,000 of yearly revenue with 82,000,000 outstanding, DSO is 59.9 days — cash arrives about two months after the goods do. That 82,000,000 is your money sitting in someone else's account, and at a 6% funding rate it costs 4,920,000 a year to leave it there. With revenue running at 1,369,863 a day, collecting ten days sooner releases 13,698,630 in one go.
Q. Can you walk through an example?
With Revenue 500,000,000, Receivables 82,000,000, Days in term 365d, Annual rate 6%, the answer is Days sales outstanding 59.9d.
Q. What do I need to enter?
Enter Revenue, Receivables, Days in term, Annual rate. The result recalculates as you type, and an empty box counts as zero.
Q. How much does the answer move if I change a number?
Changing only Revenue moves the answer to Revenue 250,000,000 → Days sales outstanding (d) 119.7 and Revenue 1,000,000,000 → Days sales outstanding (d) 29.9. The table below lays out five steps.
Q. How are the numbers rounded?
Money is shown to the nearest whole unit, percentages to one decimal place and everything else to two. What you see is rounded; the calculation itself carries the unrounded value forward.
Q. Anything to watch out for?
Use 365 days with a year of revenue and 90 with a quarter of it — mixing them puts the answer out by four times. Seasonal sales make a period-end DSO read long or short against reality, and dividing a tax-inclusive invoice balance by tax-exclusive revenue stretches DSO by the tax rate.
Related calculators
Tax rates and interest conventions differ by country and product — check your contract for real transactions.