The days' sales in inventory is calculated by dividing ending inventory by cost of goods sold and multiplying the result by 365.

Name: The days' sales in inventory is calculated by dividing ending inventory by cost of goods sold and multiplying the result by 365.
Brand: Quizplus
Rating: 4.8 (45 reviews)

Question

Quizplus · Accepted Answer

This formula is used to calculate the number of days it takes for a company to turn its inventory into sales. The higher the number of days, the longer it takes to sell inventory and generate cash flow.

The Days' Sales in Inventory Is Calculated by Dividing Ending