Days Payable Outstanding
Days Payable Outstanding Formula |
\( DPO \;=\; \dfrac{ AP \cdot n }{ COGS } \) |
Symbol |
\( DPO \) = days payable outstanding |
\( AP \) = accounts payable |
\( COGS \) = cost of goods sold |
\( n \) = number of days |
Days payable outstanding, abbreviated as DPO, is the number of average days from when a company purchases inventory and materials until the supplier is paid.