Period that indicates how long it takes a company on average to pay its trade payables. The corresponding figure is calculated by multiplying trade payables by 365 and dividing by revenue, i.e. all income resulting from transactions with business partners and relating to an exchange of services. – The ratio obtained in this way must, of course, be handled with extreme caution when making comparisons, because it has been proven that gross misjudgements can very easily occur without knowledge of the background to financing and the particular payment practices in an industry. – See Days Sales Outstanding, Working Capital.
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