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Accounts receivable and days sales outstanding
Money customers owe: receivables turnover, days sales outstanding, why they differ by industry, and the figures for each company.
The short answer
Accounts receivable is money customers owe a company for goods or services it has already delivered and billed. It's a current asset on the balance sheet. Dividing a year's revenue by receivables gives receivables turnover; 365 divided by turnover is days sales outstanding (DSO), roughly how long the company waits to be paid. The median DSO across the 68 companies here is 51 days.
The formulas
Receivables turnover = revenue ÷ accounts receivable
Days sales outstanding = 365 ÷ receivables turnover
Receivables are shown net of an allowance for credit losses, the amount the company expects not to collect. Revenue comes from the income statement; receivables from the balance sheet. Averaging the opening and closing balances gives a steadier figure than the year-end balance alone, especially for companies whose sales peak near year end.
Why it varies so much
- Who the customers are. Retailers and restaurants are paid at the till or by card within days. Companies that sell to businesses or governments usually give 30 to 90 days.
- Year-end timing. A company with a strong last quarter ends the year with high receivables, which lifts DSO even if customers pay on time.
- Other receivables. Some companies include amounts from partners or financing customers, which isn't comparable with ordinary trade receivables.
In this table Intuit has the fewest days, 11, and Salesforce the most, 126.
Receivables and cash flow
Revenue is recorded when it's earned, not when the cash arrives, so a rise in receivables means some of the year's revenue hasn't been collected yet. On the cash flow statement that increase is subtracted from net income in operating activities. Receivables growing much faster than revenue for several years can mean customers are paying more slowly. Working capital puts receivables next to inventory and payables, and accrual accounting covers the timing rule.
Every company
Revenue for the latest fiscal year and accounts receivable, net, at that year end, from each 10-K, sorted from the most days to the fewest. Days sales outstanding is 365 divided by turnover. Using year-end receivables instead of the average makes both figures approximate. Banks are left out, and so are companies whose reported receivables line is under 1% of revenue, since at those companies it usually covers only part of what customers owe.
Common questions
What is accounts receivable?
Money customers owe for goods or services already delivered and billed. It's a current asset on the balance sheet.
How do you calculate days sales outstanding?
Divide revenue by accounts receivable to get turnover, then divide 365 by turnover. Some analysts use average receivables over the year.
Is a lower DSO better?
It means the company is paid faster, but the right level depends on the industry and its customers. It's most useful compared with the company's own history.
Why do rising receivables reduce operating cash flow?
Because revenue has been recorded but the cash hasn't arrived. The increase is subtracted from net income on the cash flow statement.
What is the allowance for credit losses?
The company's estimate of receivables it won't collect. Receivables on the balance sheet are shown net of it.
Disclosures
- Editor holdings
- The editor holds shares of Tesla (TSLA) and SpaceX in a long-term retirement account. The editor holds no position in any other company named on this page. As of Nov 11, 2026.
- Compensation
- Nobody paid for this page. No affiliate links on this page.
- Sources
- Each company's own SEC filings, linked next to each number.
- Last updated
- Nov 9, 2026
General education, the same for every reader. Not a recommendation to buy, sell or hold any security, and it doesn't consider your situation.
More in Learn and Tools · Methodology & Disclosures explains where every number comes from.