Samiksha Jaiswal (Editor)

Debtor days

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The debtors days ratio measures how quickly cash is being collected from debtors. The longer it takes for a company to collect, the greater the number of debtors days. Debtor days can also be referred to as Debtor collection period. Another common ratio is the creditors days ratio.

Definition

Debtor days = Year end trade debtors Sales × Number of days in financial year

or

Debtor days = Average trade debtors Sales × Number of days in financial year

when

Average trade debtors = Opening trade debtors + Closing trade debtors 2

References

Debtor days Wikipedia


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