Days in Inventory Calculator







Formula

To calculate the Days in Inventory (D):

\[ D = \frac{365}{\left(\frac{\text{COGS}}{\left(\frac{\text{BI} + \text{EI}}{2}\right)}\right)} \]

Where:

What is Days in Inventory?

Days in inventory is an average metric of the days an item sits in inventory before it's sold. It’s important to note that this is an average, and the actual days in inventory could vary greatly from item to item, especially at low volumes.

Example Calculation 1

Let's assume the following values:

Step 1: Calculate the average inventory:

\[ \text{Average Inventory} = \frac{500 + 700}{2} = 600 \]

Step 2: Use the formula:

\[ D = \frac{365}{\left(\frac{2000}{600}\right)} = 109.5 \]

The Days in Inventory is 109.5 days.

Example Calculation 2

Let's assume the following values:

Step 1: Calculate the average inventory:

\[ \text{Average Inventory} = \frac{400 + 600}{2} = 500 \]

Step 2: Use the formula:

\[ D = \frac{365}{\left(\frac{1500}{500}\right)} = 121.67 \]

The Days in Inventory is 121.67 days.