Days Payable Outstanding - DPO

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Dictionary Says

Definition of 'Days Payable Outstanding - DPO'

A company's average payable period. Calculated as:
 

Days Payable Outstanding (DPO)


Notice that the formula may also be written as: accounts payable / (cost of sales/number of days).
Investopedia Says

Investopedia explains 'Days Payable Outstanding - DPO'

DPO is an indicator of how long a company is taking to pay its trade creditors. DPO is typically looked at either quarterly or yearly (90 or 365 days).

Learn more about this efficiency ratio in the article Measuring Company Efficiency.

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