Glossary · Finance
What is Days of inventory?
Days of inventory, also called days sales of inventory, is the average number of days stock is held before it is sold.
It is the period length divided by turnover, so 4 turns a year means about 91 days. It looks back at what happened; days of cover looks forward at what current stock will last.
Formula
Days of inventory = days in period ÷ inventory turnover
Calculate it
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