COLLECTION PERIOD (Period End) is used to appraise accounts receivable (AR). This ratio measures the length of time it takes to convert your average sales into cash. This measurement defines the relationship between accounts receivable and cash flow. A longer average collection period requires a higher investment in accounts receivable. A higher investment in accounts receivable means less cash is available to cover cash outflows, such as paying bills. NOTE: Comparing the two COLLECTION PERIOD ratios (Period Average and Period End) suggests the direction in which AR collections are moving, thereby giving an indication as to potential impacts to cash flow. Formula: AR (current) / (Net Revenue / 365)
EXPENSES are the daily costs incurred in running and maintaining a business. See expenditure.
L as the fifth letter of a Nasdaq stock symbol indicates that the issue is a class of stock such as: preferred when issued, third preferred class of warrants, sixth class of preferred stock, or foreign preferred.
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