GLOSSARY ENTRY (DERIVED FROM QUESTION BELOW) | ||||||
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15:02 Jul 5, 2012 |
Polish to English translations [PRO] Bus/Financial - Accounting | |||||||
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| Selected response from: Karol Kawczyński Poland Local time: 10:41 | ||||||
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Summary of answers provided | ||||
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4 | creditor turnover ratio |
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4 | liabilities cycle |
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4 | creditor days ratio |
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3 | days payable outstanding |
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creditor turnover ratio Explanation: . |
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days payable outstanding Explanation: Days payable outstanding (DPO) is an efficiency ratio that measures the average number of days a company takes to pay its suppliers. Reference: http://en.wikipedia.org/wiki/Days_payable_outstanding |
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liabilities cycle Explanation: propozycja |
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creditor days ratio Explanation: http://www.businesslink.gov.uk/bdotg/action/detail?itemId=10... Creditor days ratio This shows how long, on average, you are taking to pay your suppliers. For example, you owe your suppliers £9,000 on a given date and across the year you pay out £150,000. Multiply £9,000 by the days in the year, 365, and divide the result by the total amount you pay: (£9,000 x 365)/£150,000 = 22 days Suppliers are, on average, being paid in 22 days. Again, seasonal differences can influence the results so this calculation works best when your purchases are made evenly during the year. If you pay your creditors more rapidly than you are paid by your customers, you will need a high level of working capital. http://www.finance-glossary.com/define/creditor-days/1719/0/... Creditor Days A ratio measuring how long on average it takes a company to pay its creditors. Calculated by dividing the trade creditors shown in its accounts by its cost of sales, or sales, and then multiplying by 365. For example, a company with creditors of 900,000 and sales of 12m, takes on average just over 27 days to pay its bills. Within reason, the higher the number the better, although if a company is very slow in paying its creditors (say 100 days plus) it is worth asking if this is because it has problems generating enough cash quickly enough to pay them. Also the UK government has shown concern over slow payment of suppliers, often small companies, by big groups, notably the supermarket chains. The typical number of days will vary between sectors and industries. http://businesshelp.lloydstsbbusiness.com/planning/performan... Creditor days. This ratio sets out the number of days taken to pay suppliers. This is less important than the debtor day statistic, as in this case the control over payment of suppliers is in your hands. When assessing another business, for example one that is asking you for increased credit, this ratio can give a useful pointer as to whether the business is taking longer to pay people. Outside credit reference agencies use the calculations to give a profile of the business to potential suppliers looking for details about a business. The ratio is calculated: Creditor days = creditors ÷ purchases x 365 |
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