Question

How do you calculate accounts payable payment period?

Answer 1

The accounts payable payment period can be calculated by dividing the total accounts payable by the average daily cost of goods sold (COGS). The resulting number represents the number of days it takes for a company to pay its accounts payable.

Answer 2

The accounts payable payment period can be calculated by dividing accounts payable by the average daily purchases. The result is the number of days it takes for a company to pay its bills. The formula is:

Accounts Payable Payment Period = (Accounts Payable / Average Daily Purchases)

The average daily purchases can be calculated by dividing the cost of goods sold by the number of days in the year.