Inventory days, also known as Days Inventory Outstanding (DIO), refers to the average number of days a company holds its inventory before selling it.It is calculated by dividing inventory by average daily cost of sales.Average daily cost of sales is calculated by dividing total cost of goods sold by the number of days in period, typically representing the total number of days in the year or quarter.
Learn Inventory Days with interactive examples and practice exercises in our Performance Metrics module.
This interactive learning module helps you understand Inventory Days through hands-on practice and real-world examples.