Messuring Efficiency Flashcards by Georgia Lehan | Brainscape

Q

What is the formula for Inventory turnover?

A

(Average inventory / cost of sales) × 365

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Q

How is Average inventory calculated?

A

(Opening inventory + closing inventory) / 2

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Q

What is the formula for Trade payable days?

A

(Trade payables / credit purchase) × 365

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Q

How is Trade receivable days calculated?

A

(Trade receivable / credit / sales) × 365

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