Days Payables Outstanding Calculator

✖Average Account Payables is the average money owed by a company to its suppliers as per the balance sheet.ⓘ Average Account Payables [AP_avg]			+10% -10%
✖The Cost of Goods Sold is the direct costs attributable to the production of the goods sold by a company.ⓘ Cost of Goods Sold [COGS]			+10% -10%

✖Days Payables Outstanding calculates the average number of days a company takes to pay its suppliers.ⓘ Days Payables Outstanding [DPO]

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Formula

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Days Payables Outstanding

Formula

`"DPO" = ("AP"_{"avg"}/"COGS")*365`

Example

`"730"=("80000"/"40000")*365`

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Days Payables Outstanding Solution

STEP 0: Pre-Calculation Summary

Formula Used

Days Payables Outstanding = (Average Account Payables/Cost of Goods Sold)*365
DPO = (AP_avg/COGS)*365
This formula uses 3 Variables

Variables Used

Days Payables Outstanding - Days Payables Outstanding calculates the average number of days a company takes to pay its suppliers.
Average Account Payables - Average Account Payables is the average money owed by a company to its suppliers as per the balance sheet.
Cost of Goods Sold - The Cost of Goods Sold is the direct costs attributable to the production of the goods sold by a company.

STEP 1: Convert Input(s) to Base Unit

Average Account Payables: 80000 --> No Conversion Required
Cost of Goods Sold: 40000 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

DPO = (AP_avg/COGS)*365 --> (80000/40000)*365

Evaluating ... ...

DPO = 730

STEP 3: Convert Result to Output's Unit

730 --> No Conversion Required

FINAL ANSWER

730 <-- Days Payables Outstanding

(Calculation completed in 00.004 seconds)

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Credits

Created by Kashish Arora

Satyawati College (DU), New Delhi

Kashish Arora has created this Calculator and 50+ more calculators!

Verified by Vishnu K

BMS College of Engineering (BMSCE), Bangalore

Vishnu K has verified this Calculator and 200+ more calculators!

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Days Payables Outstanding Formula

Days Payables Outstanding = (Average Account Payables/Cost of Goods Sold)*365
DPO = (AP_avg/COGS)*365

What is Days Payables Outstanding (DPO)?

Day Payables Outstanding calculates the average number of days a company takes to pay its suppliers. The greater the number of days, the longer a firm takes to pay suppliers and, in some cases, the higher the company’s bargaining power over suppliers. However, a higher ratio may be perceived as an inability to pay.

How to Calculate Days Payables Outstanding?

Days Payables Outstanding calculator uses Days Payables Outstanding = (Average Account Payables/Cost of Goods Sold)*365 to calculate the Days Payables Outstanding, Days Payables Outstanding is calculated by dividing the average accounts payable balance by the cost of goods sold (COGS), and then multiplying by the number of days in the period (usually 365 days). Days Payables Outstanding is denoted by DPO symbol.

How to calculate Days Payables Outstanding using this online calculator? To use this online calculator for Days Payables Outstanding, enter Average Account Payables (AP_avg) & Cost of Goods Sold (COGS) and hit the calculate button. Here is how the Days Payables Outstanding calculation can be explained with given input values -> 730 = (80000/40000)*365.

FAQ

What is Days Payables Outstanding?

Days Payables Outstanding is calculated by dividing the average accounts payable balance by the cost of goods sold (COGS), and then multiplying by the number of days in the period (usually 365 days) and is represented as DPO = (AP_avg/COGS)*365 or Days Payables Outstanding = (Average Account Payables/Cost of Goods Sold)*365. Average Account Payables is the average money owed by a company to its suppliers as per the balance sheet & The Cost of Goods Sold is the direct costs attributable to the production of the goods sold by a company.

How to calculate Days Payables Outstanding?

Days Payables Outstanding is calculated by dividing the average accounts payable balance by the cost of goods sold (COGS), and then multiplying by the number of days in the period (usually 365 days) is calculated using Days Payables Outstanding = (Average Account Payables/Cost of Goods Sold)*365. To calculate Days Payables Outstanding, you need Average Account Payables (AP_avg) & Cost of Goods Sold (COGS). With our tool, you need to enter the respective value for Average Account Payables & Cost of Goods Sold and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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