Days Payable Outstanding

Days Payable Outstanding tells you the number of days it takes a company to pay it suppliers. Days Payable Outstanding is calculated as follows:
365 / (Credit Purchases from Suppliers / Average Accounts Payable)
This equation is equivalent to dividing 365 by the company's Accounts Payable Turnover Ratio.
Credit Purchases from Suppliers is equal to the company's Cost of Goods Sold minus Ending Inventory plus Beginning Inventory.
Some people calculate Days Payable Outstanding as follows:
365 / (Cost of Goods Sold / Average Accounts Payable)
However, the first equation listed above is more accurate.
When a company's Days Payable Outstanding increases over time, this suggests the company might be struggling to pay its suppliers. This indicates a worsening financial position for the company.-
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[@jenniferjones4792]

Is there a step skipped at the very end of getting to 42.7days? I get 85.4.

[@marzanahossain9316]

Do you have a video with partnerships ? If you please send me the link :) if not can you make a video ?

[@mohammedshammas9216]

Hi, is VAT included in COGS? or should we take it as COGS + VAT?

[@stangbien]

VAT does not go into the PnL so it is not included in the COGS