Accounts payable days formula

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Updated: Aug 20, 2021

Accounts payable days formula

The faster you pay your bill, the more willingly will your suppliers be when it comes to trading with you in the future.The accounts payable days formula measures the number of days that a company takes to pay its suppliers.

The accounts payable days formula measures the number of days that a company takes to pay its suppliers. it it used to measure the capital flow of the company.

if the number of days rises from one period to another, or stay in a higher position than its competiors over time, it indicates that the company have trouble raising the capital need to pay its suppliers.

Thus, the lower the value, the better credit line can be offered by the companys suppliers.

where V is the accelerator coefficient. Thus, the value of V tells us the strength of the effect that a change in output or sales will have on the leve! of invest­ment. The simplest form of the theory takes V as a constant determined basically by technology. However, we might also expect V to be affected by interest rates, wage rates and the degree of capacity utilization.



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James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.