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)
FIELD TRIAL is a test of the performance of a new product under the conditions under which it is intended be used.
KNOWLEDGE ACQUISITION is the process of acquiring knowledge from a human expert for an expert system, which must be carefully organized into IF-THEN rules or some other form of knowledge representation.
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