This is a brief discussion of the Receivables Turnover Ratio and Days Sales Outstanding values, common values used in evaluating the performance of the Receivables account. Target values are in the 9-10 range. What is your company\'s ratio?
2. 2010
Month January February March April May June
Period Begin 1/1/2009 2/1/2009 3/1/2009 4/1/2009 5/1/2009 6/1/2009
Period End 12/31/2009 1/31/2010 2/28/2010 3/31/2010 4/30/2010 5/31/2010
Average A/R Balance
Period Start A/R Balance $513,056 $500,961 $509,273 $485,323 $498,804 $491,972
Period End A/R Balance $469,958 $458,879 $466,493 $444,555 $456,904 $450,645
Period Average $491,507 $479,920 $487,883 $464,939 $477,854 $471,308
Receivables Turnover Ratio
Period Net Credit Sales** $4,000,000 $4,000,000 $4,000,000 $4,000,000 $4,000,000 $4,000,000
Period Average A/R Balance $491,507 $479,920 $487,883 $464,939 $477,854 $471,308
Ratio 8.14 8.33 8.20 8.60 8.37 8.49
Days In Period
Period Start 1/1/2009 2/1/2009 3/1/2009 4/1/2009 5/1/2009 6/1/2009
Period End 12/31/2009 1/31/2010 2/28/2010 3/31/2010 4/30/2010 5/31/2010
# of Days in Period 364 364 364 364 364 364
Days Sales Outstanding (DSO)
# of Days in Period 364.00 364.00 364.00 364.00 364.00 364.00
Receivables Turnover Ratio 8.14 8.33 8.20 8.60 8.37 8.49
Days Sales Outstanding (DSO) 44.73 43.67 44.40 42.31 43.48 42.89
Month July August September October November December
Period Begin 7/1/2009 8/1/2009 9/1/2009 10/1/2009 11/1/2009 12/1/2009
Period End 6/30/2010 7/31/2010 8/31/2010 9/30/2010 10/31/2010 11/30/2010
Average A/R Balance
Period Start A/R Balance $478,852 $498,804 $478,852 $472,552 $466,415 $460,435
Period End A/R Balance $438,627 $456,904 $438,627 $432,856 $427,235 $421,757
Period Average $458,740 $477,854 $458,740 $452,704 $446,825 $441,096
Receivables Turnover Ratio
Period Net Credit Sales* $4,000,000 $4,000,000 $4,000,000 $4,000,000 $4,000,000 $4,000,000
Period Average A/R Balance $458,740 $477,854 $458,740 $452,704 $446,825 $441,096
Ratio 8.72 8.37 8.72 8.84 8.95 9.07
Days In Period
Period Start 7/1/2009 8/1/2009 9/1/2009 10/1/2009 11/1/2009 12/1/2009
Period End 6/30/2010 7/31/2010 8/31/2010 9/30/2010 10/31/2010 11/30/2010
# of Days in Period 364 364 364 364 364 364
Days Sales Outstanding (DSO)
# of Days in Period 364.00 364.00 364.00 364.00 364.00 364.00
Receivables Turnover Ratio 8.72 8.37 8.72 8.84 8.95 9.07
Days Sales Outstanding (DSO) 41.75 43.48 41.75 41.20 40.66 40.14
* Period Year over
3. 9.20
9.07
9.00 8.95
8.84
8.80
8.72 8.72
8.60
8.60
8.49
8.37 8.37
8.40 8.33
8.20
8.20 8.14
8.00
January March May July September November
45.50
45 50
44.7
44.4
44.50
43.7
43.5 43.5
43.50
42 9
42.9
42.50 42.3
41.7 41.7
41.50 41.2
40.7
40.50 40.1
39.50
January March May July September November
4. 2011
Month January February March April May June
Period Begin 1/1/2010 2/1/2010 3/1/2010 4/1/2010 5/1/2010 6/1/2010
Period End 12/31/2010 1/31/2011 2/28/2011 3/31/2011 4/30/2011 5/31/2011
Average A/R Balance
Period Start A/R Balance $524,291 $528,146 $544,150 $536,029 $528,146 $520,492
Period End A/R Balance $480,249 $483,780 $498,440 $491,001 $483,780 $476,769
Period Average $502,270 $505,963 $521,295 $513,515 $505,963 $498,630
Receivables Turnover Ratio
Period Net Credit Sales* $4,800,000 $4,800,000 $4,800,000 $4,800,000 $4,800,000 $4,800,000
Period Average A/R Balance $502,270 $505,963 $521,295 $513,515 $505,963 $498,630
Ratio 9.56 9.49 9.21 9.35 9.49 9.63
Days In Period
Period Start 1/1/2010 2/1/2010 3/1/2010 4/1/2010 5/1/2010 6/1/2010
Period End 12/31/2010 1/31/2011 2/28/2011 3/31/2011 4/30/2011 5/31/2011
# of Days in Period 364 364 364 364 364 364
Days Sales Outstanding (DSO)
# of Days in Period 364.00 364.00 364.00 364.00 364.00 364.00
Receivables Turnover Ratio 9.56 9.49 9.21 9.35 9.49 9.63
Days Sales Outstanding (DSO) 38.09 38.37 39.53 38.94 38.37 37.81
Month July August September October November December
Period Begin 7/1/2010 8/1/2010 9/1/2010 10/1/2010 11/1/2010 12/1/2010
Period End 6/30/2011 7/31/2011 8/31/2011 9/30/2011 10/31/2011 11/30/2011
Average A/R Balance
Period Start A/R Balance $513,056 $498,804 $495,023 $491,972 $498,804 $513,056
Period End A/R Balance $469,958 $456,904 $453,440 $450,645 $456,904 $469,958
Period Average $491,507 $477,854 $474,231 $471,308 $477,854 $491,507
Receivables Turnover Ratio
Period Net Credit Sales** $4,800,000 $4,800,000 $4,800,000 $4,800,000 $4,800,000 $4,800,000
Period Average A/R Balance $491,507 $477,854 $474,231 $471,308 $477,854 $491,507
Ratio 9.77 10.04 10.12 10.18 10.04 9.77
Days In Period
Period Start 7/1/2010 8/1/2010 9/1/2010 10/1/2010 11/1/2010 12/1/2010
Period End 6/30/2011 7/31/2011 8/31/2011 9/30/2011 10/31/2011 11/30/2011
# of Days in Period 364 364 364 364 364 364
Days Sales Outstanding (DSO)
# of Days in Period 364.00 364.00 364.00 364.00 364.00 364.00
Receivables Turnover Ratio 9.77 10.04 10.12 10.18 10.04 9.77
Days Sales Outstanding (DSO) 37.27 36.24 35.96 35.74 36.24 37.27
* Period Year Over
5. 10.30
10.18
10.12
10.10 10.04 10.04
9.90
9.77 9.77
9.70 9.63
9.56
9.49 9.49
9.50
9.35
9.30
9.21
9.10
January March May July September November
40.00
39.5
39.50
38.9
39.00
38.4 38.4
38.50
38.1
38.00
38.00 37.8
37.50 37.3 37.3
37.00
36.50 36.2 36.2
36.0
36.00
36 00 35.7
35.50
35.00
January March May July September November