Definition
The average number of days a company takes to pay its bills, used as a measure of how much it depends on trade credit for short-term financing.
As a rule of thumb, a well managed company's days accounts payable do not exceed 40 to 50 days. Also called days sales in payables. Formula: Average accounts payable x 365 ÷ cost of sales.
Related Articles
- Financing Your Small Business - Writing a Business Plan *
- Budgeting and Saving: Quicken v. Microsoft Money *
- Introduction to Bonds *
- AMEX, NASDAQ, OTC and Other Exchanges *
- Investment Clubs *
- What is a Credit Union? *
- An Overview of Retirement Planning *
- Bond Mutual Funds *
Related Videos
http://www.businessdictionary.com/definition/days-accounts-payable-Days-A-P.html
