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Inventory Turnover & Days in Inventory Calculator
Calculate annual inventory turnover and days in inventory from cost of goods sold and inventory values.
Inventory turnover calculator
Calculate annual inventory turnover and days in inventory from cost of goods sold and inventory values.
YOUR RESULT LIVE CALCULATION
Annual inventory turnover
6turns / year
365-DAY COST BASISOne less spreadsheet to keep open.
- Average inventory at cost
- $160,000
- Days in inventory
- 60.8 days
- Annual cost of goods sold
- $960,000
- Average daily COGS
- $2,630.14
Opening/closing average approximation. Not a forward-looking stock-coverage forecast.
BEHIND THE NUMBER
How the calculation works
Inventory values and cost of goods sold must be on the same cost basis and in the same currency. This model approximates average inventory using the opening and closing balances of a year, then uses a 365-day year. It measures historical value-based turnover, not forward-looking stock coverage.
Average inventory = (opening + closing) / 2; turns = annual COGS / average inventory; days in inventory = 365 / turns
When this calculation helps
Inventory turnover provides a historical value-based view of how much stock supported a period of cost of goods sold. Compare like periods and a consistent cost valuation method.
Check the interpretation
Opening and closing balances can hide a seasonal peak or a stockout. Higher turns can reflect efficient inventory or insufficient availability. Read the result alongside service and dated stock coverage rather than treating it as a stand-alone stocking target.
Two balances can hide seasonal or intra-year changes. Use a representative average for detailed analysis. Higher turnover alone does not establish good stock availability or operational performance.
Oracle inventory turnover definitionWorked example: Reorder Point and Safety Stock: A Practical Example
Good to know
Should I enter revenue instead of COGS?
No. Inventory valued at cost must be compared with cost of goods sold, not sales revenue.
Is days in inventory the same as days of supply?
No. This is a historical measure based on inventory value and COGS. Days of supply compares available physical units with a daily demand estimate.