c16.cc|官网下载

                        Businessmate Site Logo

                        Home - About - Advertise

                        Date: 2020-06-08
                        Search Articles by topic

                        Mangement and Leadership

                        Production Management


                        Business Strategy

                        Accounting

                        Marketing

                        Human Resource Management


                        Organizational Theory & Design


                        National and Organizational Culture

                        Important Business Terms

                         

                        Article Search
                        Search Title & Content:
                        Search Author:

                        Custom Search

                         

                         

                         

                         

                         

                        Inventory Turnover

                         
                        Recommend this article to your friends!
                         
                        The metric Inventory Turnover tries to evaluate how many times a company's inventory is sold and replaced over a period of time.

                        There are generally two ways of calculating the Inventory Turnover Ratio:

                        1) Basic calculation:
                        Inventory Turnover = Sales / Average Inventory

                        In this formula "Sales" is being used as the numerator. This is not an optimal approach, because sales are normally recorded at market value. This means that that the recorded value is higher than the actual value of the inventory, which will make the Inventory Turnover Ratio higher than it really is.

                        2) Alternative calculation:
                        Inventory Turnover = Cost of Goods Sold / Average Inventory

                        In this alternative calculation the numerator "Cost of Goods Sold" is assessed by the actual costs of the inventory. Accordingly, the alternative calculation is more precise in evaluating how often the actual worth of the average inventory is sold and replaced over a period of time.

                        A low turnover implies poor sales compared with the value of the inventory. A high turnover implies strong sales compared to the value of the inventory.

                         
                        ?
                         
                         
                         
                        Date Created: 2009-11-18
                        Posted by: Admin
                         
                         
                        Inventory Turnover
                         

                        Related resources:

                        Return on Investment (ROI)
                        Return on Assets (ROA)
                        Return on Equity (ROE)
                        Return on Sales (ROS)
                        Return on Capital Employed (ROCE)
                        Contribution Margin and Contribution Margin Ratio
                        Reference(s)
                         
                        Keywords:

                        Online MBA, Online MBA Courses, Inventory Turnover, calculation, formula

                         






                        Advertise on Businessmate.org


                         
                         

                        Copyright © BusinessMate 2009-2019

                         
                        Home - About - Terms of Use - Contact - Sitemap - Privacy Policy

                                              Super League

                                              society

                                              Real estate

                                              education

                                              game

                                              city

                                              constellation

                                              aviation

                                              entertainment