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Days Inventory Outstanding Calculator

Convert inventory into the average number of days stock sits before it is sold.

About Days Inventory Outstanding Calculator

Dividing a balance-sheet stock by the daily flow that passes through it converts money into days. The turns figure is the same relationship inverted: how many times the balance is replaced over the period. Days measures are directly comparable across businesses of any size, and each day removed from the inventory cycle releases cash without needing new financing.

Formula

Days Inventory Outstanding

Days Inventory Outstanding = Average inventory ÷ Annual cost of goods sold × days in period

Average inventory
Balance sitting on the balance sheet
Annual cost of goods sold
Flow through the income statement over the period

Worked example

With the default values below, Days Inventory Outstanding Calculator returns Days Inventory Outstanding of 60.8. Change any input above and every figure here is recalculated in your browser.

Inputs used

Average inventoryminimum 0
150,000
Annual cost of goods soldminimum 0
900,000
Days in the periodaccepts 1–366 days
365 days

Results

Days Inventory Outstanding
60.8 days
Turns per Period
6.00
Average Daily Flow
$2,465.75
Days Inventory Outstanding
8.69 weeks
Days Inventory Outstanding
2.00 months

Step by step

  1. 1Values used
  2. 2Days Inventory Outstanding
  3. 3Days Inventory Outstanding= 60.8 days
  4. 4Turns per Period= 6.00
  5. 5Average Daily Flow= 2,465.75
  6. 6Days Inventory Outstanding= 8.69 weeks
  7. 7Days Inventory Outstanding= 2.00 months

Assumptions and limits

  • The result is derived only from the 3 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation or tax into account.
  • Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How is Days Inventory Outstanding calculated?

Days Inventory Outstanding = Average inventory ÷ Annual cost of goods sold × days in period Dividing a balance-sheet stock by the daily flow that passes through it converts money into days. The turns figure is the same relationship inverted: how many times the balance is replaced over the period.

Why does Days Inventory Outstanding matter?

Days measures are directly comparable across businesses of any size, and each day removed from the inventory cycle releases cash without needing new financing.

What values do I need to enter?

This calculator takes 3 inputs: Average inventory, Annual cost of goods sold, Days in the period. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.

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