The payables turnover ratio is a financial metric used to assess how efficiently a company manages its accounts payable. It measures the frequency with which a company pays off its suppliers within a given period, typically a year. The formula for the payables turnover ratio is the cost of goods sold divided by the average accounts payable balance during the same period, indicating how quickly a company pays its suppliers relative to its purchases.
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Emagia is a leading provider of AI-powered Order-to-Cash (O2C) automation platform that modernizes finance operations for midsize to large global businesses. Many global businesses and shared service centers use Emagia’s Autonomous O2C to transform to digital world-class operations in credit, invoicing and payments, receivables, collections, deductions, cash application and cash forecasting. Emagia solutions improve their customers DSO, cash flow, credit risk, operational cost, compliance and profitability.