average payment period
The average payment period is a measurement of how long a time it takes on average for a business to pay back its creditors. Calculating this requires dividing the amount of credit purchases by the 365 days in a year, and then dividing this amount into the total accounts payable for the year.he average payment period is determined by dividing the accounts payable by the average credit purchases per day. In this case, it would be $60,000 USD divided by $2,000 USD, which yields a quotient of 30.