Free calculator

Days Sales Outstanding (DSO) calculator

Enter your receivables balance, your credit sales for the period and the number of days in the period. The calculator gives your DSO and the cash you would free by reducing it.

Your DSO
27.0 days
Credit sales per day
₹2,22,222
Cash freed at 30-day DSO
₹0

DSO = receivables ÷ credit sales × days in period. Cash freed = (current DSO − target DSO) × average daily credit sales.

Short answer

DSO = (accounts receivable ÷ credit sales) × days in period. If you have ₹60 lakh outstanding on ₹2 crore of quarterly credit sales, DSO is 27 days. Every day of DSO on ₹2 crore a quarter is about ₹2.2 lakh of working capital.

What a good DSO looks like

Compare DSO to your stated credit period. If you give 30 days and your DSO is 75, half your receivables are overdue. Track it monthly and by customer; the customers driving the number up are the ones to move to advance, mandates or legal action.

How to reduce it

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Keep these ready
  • The unpaid invoice(s) and payment terms
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FAQ

Questions, answered

Credit sales. Cash sales do not create receivables and would understate the DSO.

This page is general information for Indian businesses, not legal advice for your specific case. Laws, rates and procedures change; speak to an advocate before acting. FundRaksha LegalTech Pvt Ltd is a technology company; legal work is carried out by enrolled advocates.