Free DSO Calculator
Calculate Days Sales Outstanding (DSO) instantly using accounts receivable, revenue, and the number of days in the period with our free financial calculator.
When to use this calculator
Days sales outstanding (DSO) estimates how long receivables stay open before cash lands. Credit controllers and CFOs monitor it in monthly cash meetings and before raising customer limits. Recalculate when billing cycles, dispute rates, or mix of net-60 accounts shift.
Methodology and inputs
DSO = (accounts receivable ÷ credit sales) × days in period. Use credit sales only — cash sales excluded. AR and sales must cover the same trailing window.
Worked example
A commercial cleaning franchise reports AR $486,000 and credit sales $2.85M over 90 days. DSO = ($486,000 ÷ $2,850,000) × 90 = 15.3 days — strong, but one municipal contract at 45-day terms contributes 28% of AR and can skew blended DSO if it grows.
How to interpret the result
Rising DSO with flat terms means collection execution slipped or disputes rose. Compare to contractual terms — DSO materially above terms signals process debt, not customer quality alone.
Reviewed by ZBI Tools · Practical finance and operations calculators for SMB teams.
Further reading
For a deeper walkthrough of the concepts behind this tool, see our guide: Read the full analysis guide.
Related hub: Browse all calculators · Analyzers & calculators home · About Zen Box Infinity
Practical questions
Include unbilled revenue?
Only if your AR balance includes accrued billings per GAAP — otherwise align numerator and denominator.
Monthly vs quarterly DSO?
Monthly for high-variance portfolios; quarterly smooths one-off big invoices.
Does factoring affect DSO?
If receivables are sold, define whether you measure internal DSO pre-factor or post — document the choice.
Formulas
DSO = (Accounts Receivable ÷ Revenue) × Days in Period
Example: Receivables EUR 95,000; monthly revenue EUR 400,000; 30 days → DSO ≈ 7.1 days (use consistent period).
Source: ZBI Business Control Library — dso.
FAQ
What is DSO?
Average number of days to collect receivables for the revenue in the period.
Why must revenue be greater than zero?
DSO divides receivables by revenue—zero revenue makes the metric undefined.