Inventory Turnover Calculator
Divide a year of cost of goods sold by average inventory to see how many times the stock cycled. 600,000,000 of COGS against 100,000,000 of average inventory is six turns, and 365 over six is 60.8 days sitting on the shelf. Knowing COGS runs at 1,643,836 a day makes the prize obvious: cutting ten days out of inventory frees about 16,440,000 of cash.
Your numbers
Inventory turns
6×
Days of inventory
60.8d
COGS a day
1,643,836
Formula
Inventory turns = Cost of goods sold ÷ Average inventory, Days of inventory = 365 ÷ Inventory turns
Average inventory means opening plus closing over two. Use the closing figure alone and turnover reads low just after a peak season and high just after a lull. Some places divide revenue rather than COGS, which inflates turns by the margin and makes the number incomparable. Normal ranges differ wildly by trade — groceries and furniture cannot be measured with the same ruler.
What to enter
| Input | Default | Accepted range |
|---|---|---|
| Cost of goods soldWhat the goods you sold cost to buy or make — not the revenue. | 600,000,000 | 0 and up |
| Average inventoryOpening and closing stock averaged; the closing figure alone follows the season. | 100,000,000 | 0 and up |
Step by step
Quick reference table
Results when only Cost of goods sold changes and everything else stays put.
| Cost of goods sold | Inventory turns (×) | Days of inventory (d) | COGS a day |
|---|---|---|---|
| 300,000,000 | 3 | 121.7 | 821,918 |
| 450,000,000 | 4.5 | 81.1 | 1,232,877 |
| 600,000,000 | 6 | 60.8 | 1,643,836 |
| 900,000,000 | 9 | 40.6 | 2,465,753 |
| 1,200,000,000 | 12 | 30.4 | 3,287,671 |
What each result means
| Result | At default values |
|---|---|
| Inventory turns (×)How many times stock cycled in a year — COGS over average inventory. | 6 |
| Days of inventory (d)Average days stock sits on the shelf — 365 divided by the turns. | 60.8 |
| COGS a dayCOGS running out per day; it prices a day of inventory directly. | 1,643,836 |
Common mistakes
Average inventory means opening plus closing over two. Use the closing figure alone and turnover reads low just after a peak season and high just after a lull. Some places divide revenue rather than COGS, which inflates turns by the margin and makes the number incomparable. Normal ranges differ wildly by trade — groceries and furniture cannot be measured with the same ruler.
Glossary
- Cost of goods sold
- What the goods you sold cost to buy or make — not the revenue.
- Average inventory
- Opening and closing stock averaged; the closing figure alone follows the season.
- Inventory turns
- How many times stock cycled in a year — COGS over average inventory.
- Days of inventory
- Average days stock sits on the shelf — 365 divided by the turns.
- COGS a day
- COGS running out per day; it prices a day of inventory directly.
Frequently asked questions
Q. How is Inventory Turnover Calculator calculated?
Inventory turns = Cost of goods sold ÷ Average inventory, Days of inventory = 365 ÷ Inventory turns — Divide a year of cost of goods sold by average inventory to see how many times the stock cycled. 600,000,000 of COGS against 100,000,000 of average inventory is six turns, and 365 over six is 60.8 days sitting on the shelf. Knowing COGS runs at 1,643,836 a day makes the prize obvious: cutting ten days out of inventory frees about 16,440,000 of cash.
Q. Can you walk through an example?
With Cost of goods sold 600,000,000, Average inventory 100,000,000, the answer is Inventory turns 6×.
Q. What do I need to enter?
Enter Cost of goods sold, Average inventory. The result recalculates as you type, and an empty box counts as zero.
Q. How much does the answer move if I change a number?
Changing only Cost of goods sold moves the answer to Cost of goods sold 300,000,000 → Inventory turns (×) 3 and Cost of goods sold 1,200,000,000 → Inventory turns (×) 12. The table below lays out five steps.
Q. How are the numbers rounded?
Money is shown to the nearest whole unit, percentages to one decimal place and everything else to two. What you see is rounded; the calculation itself carries the unrounded value forward.
Q. Anything to watch out for?
Average inventory means opening plus closing over two. Use the closing figure alone and turnover reads low just after a peak season and high just after a lull. Some places divide revenue rather than COGS, which inflates turns by the margin and makes the number incomparable. Normal ranges differ wildly by trade — groceries and furniture cannot be measured with the same ruler.
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