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Inventory days
(Average inventory/Cost of sales) x 365days
Average inventory can be arrived by taking this year's and last year's inventory values and dividing by 2 - (Opening inventories+ closing inventories) / 2
This ratio shows how long the inventory stays in the company before it is sold. The lower the ratio the more efficient the company is trading, but this may result in low levels of inventories to meet demand.
A lengthening inventory period may indicate a slowdown in trade and an excessive build-up of inventories, resulting in additional costs.
The Federal Minister for the Environment is worried about the Greenhouse Effect, one outcome of which would be that Adelaide would have a subtropical climate by the year 2015. This
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#questioDiscuss the applicability of an operating cycle in the vegetable growing business n..
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