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  2. Days in inventory - Wikipedia

    en.wikipedia.org/wiki/Days_in_inventory

    The average inventory is the average of inventory levels at the beginning and end of an accounting period, and COGS/day is calculated by dividing the total cost of goods sold per year by the number of days in the accounting period, generally 365 days. [3] This is equivalent to the 'average days to sell the inventory' which is calculated as: [4]

  3. Inventory turnover - Wikipedia

    en.wikipedia.org/wiki/Inventory_turnover

    In accounting, the inventory turnover is a measure of the number of times inventory is sold or used in a time period such as a year. It is calculated to see if a business has an excessive inventory in comparison to its sales level. The equation for inventory turnover equals the cost of goods sold divided by the average inventory.

  4. Reorder point - Wikipedia

    en.wikipedia.org/wiki/Reorder_point

    Reorder level = Average daily usage rate × Lead time in days = 50 units per day × 7 days = 350 units. When the inventory level reaches 350 units an order should be placed for material. By the time the inventory level reaches zero towards the end of the seventh day from placing the order materials will reach and there is no cause for concern.

  5. Inventory - Wikipedia

    en.wikipedia.org/wiki/Inventory

    Average Days to Sell Inventory = Number of Days a Year / Inventory Turnover Ratio = 365 days a year / Inventory Turnover Ratio This ratio estimates how many times the inventory turns over a year. This number tells how much cash/goods are tied up waiting for the process and is a critical measure of process reliability and effectiveness.

  6. Gross margin return on inventory investment - Wikipedia

    en.wikipedia.org/wiki/Gross_margin_return_on...

    Due to the textbook GMROII formula, depending on the time period, a different result would occur. For example: ($100,000 annual profit) / ($25,000 average inventory cost) = GMROII of 4.0 ($8,000 July profit) / ($25,000 average inventory cost) = GMROII of 0.32 ($4,000 first two weeks of July profit) / ($25,000 average inventory cost) = GMROII of ...

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  8. Days payable outstanding - Wikipedia

    en.wikipedia.org/wiki/Days_payable_outstanding

    Days payable outstanding (DPO) is an efficiency ratio that measures the average number of days a company takes to pay its suppliers.. The formula for DPO is: = / / where ending A/P is the accounts payable balance at the end of the accounting period being considered and Purchase/day is calculated by dividing the total cost of goods sold per year by 365 days.

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    AOL Mail welcomes Verizon customers to our safe and delightful email experience!