Latest revision as of 14:48, 10 June 2017
Days of Finished Goods Inventory measures the number of days worth of Inventory the company holds on its books that have a Finished Goods status. Merchandizing companies (Retailers) call this Merchandizing Inventory.
Calculation
| Days of Finished Goods Inventory |
| = |
| Finished Goods Inventory |
× 365 days |
| Cost of Goods Sold |
|
where:
- Finished Goods Inventory = Average Finished Goods Inventory (= average of beginning and ending inventories). Finished Goods Inventory includes Unrestricted, Restricted and Blocked FG Inventory.
- CO11 = Total annual Cost of Goods Sold
Unit of measure: days (Calendar days)
Alternative names include: Finished Goods Inventory Days of Supply. See also: Finished Goods Inventory Turns.
Notes
Days of Finished Goods Inventory may be calculated using value or volume. Value-based is preferred as Asset Efficiency focuses on the efficient use of capital. Volume-based calculations may overstate the importance of inventories of low-value materials.
Community Importance
Rating:
Hierarchy
| ID | Name | Level | x | | AE12 | Days of Inventory | 2 | AE12 |
| AE123 | Days of Finished Goods Inventory | 3 | AE123 |
| AE1231 | Finished Goods Inventory - Unrestricted | 4 | AE1231 |
| AE1232 | Finished Goods Inventory - Restricted | 4 | AE1232 |
| AE1233 | Finished Goods Inventory - Blocked | 4 | AE1233 |
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