Days in inventory - wikipedia Days in inventory Days in inventory ( also known as ' Inventory Days of Supply ( DoS ) ', ' Days Inventory Outstanding ' or ' the Inventory Period ' ) is an efficiency ratio that measures the average number of days the company holds its inventory before selling it. The ratio measures the number of days funds are tied up in inventory. Inventory levels ( measured at cost ) are divided by sales per day ( also measured at cost rather than selling price. ) The formula for DII is : D I I = a v e r a g e i n v e n t o r y C O G S / D a y s ( displaystyle DII = ( dfrac ( average ~ inventory ) ( COGS / Days ) ) ) where the average inventory is the average of inventory levels at the beginning and end of an accounting period, and COGS / day is calculated by dividing the total cost of goods sold per year by 365 days. This is equivalent to the ' average days to sell the inventory ' which is calculated as : Average days to sell the inventory = 365 days Inventory Turnover Ratio ( displaystyle ( mbox ( Average days to sell the inventory ) ) = ( \frac ( mbox ( 365 days ) ) ( mbox ( Inventory Turnover Ratio ) ) ) ) The article on Inventory turnover provides a more complete discussion of issues related to the diagnosis of inventory effectiveness, although it does not provide these synonyms. See also Working capital analysis Days sales outstanding Days payable outstanding Cash conversion cycle Notes Jump up ^ Ross, S., Westerfield, Jordan, B. : Essentials of Corporate Finance, Eighth Edition, page 60, McGraw - Hill, 2014. Jump up ^ Berman, K., Knight, J., Case, J. : Financial Intelligence for Entrepreneurs, page 149. Harvard Business Press, 2008. Jump up ^ Weygandt, J.J., Kieso, D.E., & Kell, W.G. ( 1996 ). Accounting Principles ( 4th ed. ). New York, Chichester, Brisbane, Toronto, Singapore : John Wiley & Sons, Inc. p. 802. External links Retrieved from `` https://en.wikipedia.org/w/index.php?title=Days_in_inventory&oldid=765607800 '' Categories : Financial ratios Working capital management Talk About Wikipedia Add links This page was last edited on 15 February 2017, at 11 : 01. About Wikipedia

Question: what is the average days to sell inventory
Answer: an efficiency ratio that measures the average number of days the company holds its inventory before selling it