AVERAGE PAYMENT PERIOD Definition

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AVERAGE PAYMENT PERIOD (APP) is the number of days an entity takes to pay off credit purchases. As the average payment period increases, cash should increase as well, but working capital will remain the same. Formula: accounts payable / (total annual purchases / 360).

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PERSONAL EQUITY is that portion of equity ownership that is held to ones own benefit or invested as an integral part of the assets of a legal entity.

MITIGATING is a reducing in force or intensity.

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