How to Calculate Average Collection Period?
Average Collection Period calculator uses Average Collection Period = Accounts Receivable/(Sales for Reporting Period/Reporting Period Length) to calculate the Average Collection Period, The Average Collection Period is the approximate amount of time that it takes for a business to receive payments owed in terms of accounts receivable. Average Collection Period is denoted by ACP symbol.
How to calculate Average Collection Period using this online calculator? To use this online calculator for Average Collection Period, enter Accounts Receivable (AR), Sales for Reporting Period (S_{RP}) & Reporting Period Length (t) and hit the calculate button. Here is how the Average Collection Period calculation can be explained with given input values -> 0.131004 = 2000/(458000/30).