accounts payable (A/P) to sales ratio
Definition
Relationship between unpaid suppliers' bills and the sales revenue in an accounting period. It is considered high if it approaches 1.0 and, in some industries, may be a sign that the firm is having liquidity problems. Formula: Total accounts payable ÷ Sales revenue.
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accounts payable (A/P) to sales ratio is in the Accounting & Auditing, Banking, Commerce & Finance and Entrepreneurship, Management, & Leadership subjects.
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