Inventory Turnover Ratio Calculator
Enter cost of goods sold and average inventory to see how often stock turns over in a period.
General information only; consult a financial professional for analysis.
Examples
- COGS 50,000 and average inventory 10,000 ⇒ 5 times
- COGS 120,000 and average inventory 30,000 ⇒ 4 times
- COGS 75,000 and average inventory 15,000 ⇒ 5 times
FAQ
What does a higher ratio indicate?
A higher turnover suggests efficient inventory use and strong sales.
Is zero inventory allowed?
Average inventory must be above zero to compute the ratio.
Should I use cost or retail value?
Use cost of goods sold and average inventory at cost for consistency.
What time period should I use?
Match the period of COGS and average inventory, typically one year.
Additional Information
- Use the average of beginning and ending inventory for the period.
- Very high turnover may indicate insufficient stock levels.