- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
re: Cost of DSO
Posted on 3/2/11 at 9:58 pm to TheHiddenFlask
Posted on 3/2/11 at 9:58 pm to TheHiddenFlask
Why wouldn't you just take the AR balance and discount it by your WACC? Wouldn't the DSO just tell you how to compound your WACC?
EG: Your boy has 500 in AR and his DSO is 90, WACC 8%. The PV of your DSO is the 500/(1+WACC^(1/4)), where 1/4 is 90/360, so 490. Your cost per 90 days outstanding is 10.
EG: Your boy has 500 in AR and his DSO is 90, WACC 8%. The PV of your DSO is the 500/(1+WACC^(1/4)), where 1/4 is 90/360, so 490. Your cost per 90 days outstanding is 10.
1
Posted on 3/2/11 at 10:47 pm to kfizzle85
quote:
EG: Your boy has 500 in AR and his DSO is 90, WACC 8%. The PV of your DSO is the 500/(1+WACC^(1/4)), where 1/4 is 90/360, so 490. Your cost per 90 days outstanding is 10.
That's right. Thanks for that, it was bugging me.
Page 1 of 1
Popular
Back to top
Follow TigerDroppings for LSU Football News