1 / 15

Formulas to Know: Average Inventory

Formulas to Know: Average Inventory. Month 1 + Month 2 + Month 3 Number of months. No audio on this slide. Inventory valued at $1,000,000. Product. Product. Product. Product. Product. Product. Product. Product. Sales = $1,000,000. Product. Product.

merv
Download Presentation

Formulas to Know: Average Inventory

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Formulas to Know: Average Inventory Month 1 + Month 2 + Month 3 Number of months No audio on this slide.

  2. Inventory valued at $1,000,000 Product Product Product Product Product

  3. Product Product Product Sales = $1,000,000 Product Product We sell a million dollars worth of product out the door…

  4. And replace it with… Product Product Product Product Product Sales = $1 MM

  5. And replace it with… Product Product Product Product New inventory valued at $1,000,000 Product Product Product Product Product Product Sales = $1 MM

  6. Product Product Product Product Inventory valued at $1,000,000 Product Product Product Product Product Product Sales = $1 MM We have turned over our inventory one time.

  7. Net sales_______ = $1,000,000 Average inventory at retail = $1,000,000 = 1 Product Product Product Product Inventory valued at $1,000,000 Product Product Product Product Product Product Sales = $1 MM We have turned over our inventory one time.

  8. Net sales_______ = $1,000,000 Average inventory at retail = $1,000,000 Product Product Product Product Average inventory valued at $1,000,000 Product Product Product Product Product Product Sales = $1 MM However, it is average inventory.

  9. Net sales_______ = $1,000,000 Averageinventory at retail = $1,000,000 Product Product Product Product Product Product Product Average inventory valued at $1,000,000 Product Product Product Product Product Product Product Product Sales = $2 MM

  10. Net sales_______ = $2,000,000 Averageinventory at retail = $1,000,000 = 2 inventory turns Product Product Product Product Product Product Product Average inventory valued at $1,000,000 Product Product Product Product Product Product Product Product Sales = $2 MM

  11. Net sales_______ = $2,000,000 Averageinventory at retail = $ 500,000 Product Product Product Product Product Product Product Average inventory valued at $500,000 Product Product Product Product Product Sales = $2 MM

  12. Net sales_______ = $2,000,000 Averageinventory at retail = $ 500,000 Product Product Product Product Product Product Product Average inventory valued at $500,000 Product Product Product Product Product Sales = $2 MM

  13. Net sales_______ = $2,000,000 Average inventory at retail = $ 500,000 = 4 inventory turns Product Product Product Product Product Product Product Average inventory valued at $500,000 Product Product Product Product Product Sales = $2 MM

  14. Net sales_______ = $2,000,000 Averageinventory at retail = $ 500,000 = 4 inventory turns Product Product Product Product Product Product Product Average inventory valued at $500,000 Product Product Product Product Product Sales = $2 MM We have kept sales levels up, using less average inventory.

  15. PPT 12-6 Gross Margin %, Inventory Turnover, & GMROI for Selected Department in Discount Stores

More Related