The business clarity series · Video 16
The Stock on Your Shelf Is Money You Can't Spend Yet
Stock on the shelf may be ready to sell, but it can also represent money tied up while you wait.
0:37 · English narration · Captions included in the video
Full transcript
Stock on the shelf may be ready to sell, but it can also represent money tied up while you wait.
Imagine annual cost of goods sold of one hundred twenty thousand dollars, and average inventory at cost of forty thousand dollars.
Divide one hundred twenty thousand by forty thousand. The example turns inventory about three times a year.
There is no single ideal rate for every business. Consider seasonality, lead times, and products that have stopped moving.
Try the free inventory turnover calculator at YourAI Ledger dot com, and review your stock with a clearer purpose.
Illustrated educational overview. Examples and amounts are fictional where shown. Confirm accounting and tax decisions with a qualified professional.