business ratio analysisaverage inventory period ratio
average inventory period description

The Average Inventory Period  is included in the following highlighted FINANCIAL STATEMENT RATIO SPREADSHEETS

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RA - 15

RA - 25

RA - 35

RA - 50 Professional

RA - 70 Small Business

RA - 75 Expert

RA - 100 Genius

RA - 125 Wizard

RA - 150 Extreme

 

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inventory holding period
business ratio analysis

Average Inventory Period Ratio
inventory holding period

Formula to calculate average inventory period:

Average Inventory Period = (inventory x 365 days) / cost of sales.

 

Average inventory period definition and explanation:

 

The average inventory period is also referred to as Days Inventory and Inventory Holding Period.

 

This ratio calculates the average time that inventory is held.

 

Individual inventories should be looked at to find areas where the inventory, and inventory holding period, can be reduced. 

The average inventory period should be compared to competitors.

The average inventory period is included in the the financial statement ratio analysis spreadsheets highlighted in the left column, which provide formulas, definitions, calculation, charts and explanations of each ratio. 

The average inventory period is included in the book "Financial Statement Analysis including over 200 ratios" available for $35 (freight included). Download for $7. Spreadsheet calculators also available.

The average inventory period, Days Inventory or Inventory Holding Period is listed in our efficiency ratios.

 
The average inventory period and other ratios are key to understanding financial statements. Our ratio calculation spreadsheets reduce time and effort in calculating decision making ratios. They reduce risk for lenders and investors and enable owners, managers and consultants to increase productivity and business profits. These spreadsheets are bargain priced to provide a huge return on investment. Click here for more details.

Spreadsheets to calculate ratios (includes formulas, definitions, explanations and charts):

See list of ratios , or the financial statement ratio analysis spreadsheets which are not highlighted in the left column, to see which other ratios our spreadsheets calculate, define and explain.  

The average inventory period may be included in our custom 1, 3 or 5 period financial statement ratio analysis spreadsheet.

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average inventory holding period
average inventory holding period