This tutorial explains how to calculate Days Inventory in detail, including the formula, calculations, and interpretations. It discusses why days inventory is such an important indicator of a company's inventory management. Thereafter, we will use the Colgate Case Study to calculate this ratio in Excel.
You can download the Colgate Days Inventory template from this link - www.wallstreet...
What is Days Inventory?
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Days inventory indicates how long it takes a company to turn its inventory into sales.
Formula
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Days in Inventory Formula = 365 / Inventory Turnover
Uses
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- Days inventory ratio can be used to determine how long a company takes to manage and transform its inventory.
- Inventory turnover ratio and days inventory are both useful indicators of a company's inventory management efficiency.
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19 сен 2024
