Is your account receivable report showing a high balance or a low balance? Or you are not sure when you last view the report. Account receivable is money which is owed to your company by customers for products and services that you provided on credit. The simple meaning is cash is coming in.
Accounts Receivable (AR) Days (accounts receivable divided by sales, multiplied by 365 days) can help you see roughly the number of days your company takes to turn accounts receivable into cash. The lower numbers are more desirable, since it is better to have cash in the bank than extra receivables on the books.
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