Inventory turnover formula

There’re two alternatives about the inventory turnover formula, one shows the result as times p.a., another shows the result as days.

This calculated result is shown as the times p.a.

This calculated result is shown as the days. Here 365 days is the length of accounting period.

Sometimes an average (based on the average inventory) is calculated which has a smoothing effect but may dampen the effect of a major change in the period.

So the inventory turnover formulas will also be:

or

The inventory turnover formula is as mentioned above.

Related posts:

1. Calculate inventory turnover
2. Inventory turnover ratio
3. Inventory turnover analysis
4. Average inventory cost
5. Return on capital employed (ROCE) ratio and formula