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What Is Days Sales Outstanding (DSO)?

By Robin Hartill, CFPUpdated Sep 13, 2025 at 5:19 PM

Key Points

  • DSO measures time to convert credit sales to cash; lower DSO signifies quicker collection.
  • High DSO can indicate customer financial issues or lenient payment terms.
  • Balancing DSO with DPO aids in optimizing company's cash flow management.

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