- abandonment costs
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- accelerated depreciation
- accession rate
- accumulated depreciation
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- adjustable peg system
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- age-earnings profile
- age of inventory
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- austrian school
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- bankruptcy
- barriers to entry
- barter
- bear
- beggar-thy-neighbor
- behavioral economics
- beta coefficient (β)
- bill-of-lading
- bill-of-sale
- black economy
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- blue chips
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- board-of-directors
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- bond market
- bond prices
- bond ratings
- book value
- boom
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- bretton woods agreement
- budget deficit
- budget surplus
- bull
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- by-product
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- cambridge school
- capacity utilization
- capital
- capital asset
- capital intensive
- capitalism
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- casual employment
- central bank
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- currency depreciation
- currency risk
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- customs duty
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- deflation
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- expansion costs
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- export subsidies
- externalities
- face value
- factoring
- factors of production
- federal deposit insurance company (fdic)
- financial account
- financial asset
- financial risk
- financial statement
- fiscal policy
- fixed asset
- fixed costs
- fixed exchange rates
- floating exchange rates
- f.o.b. (free on board)
- forced saving
- foreign aid
- foreign direct investment (fdi)
- forward contract
- forward exchange market
- franc
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- futures
- gatt
- gold standard
- government spending
- gray-collar workers
- gross domestic product (gdp)
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- hedging
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- preferred stock
- present value
- producer price index (ppi)
- proletariat
- purchasing power
- put option
- rate of return pricing
- real asset
- real gross domestic product
- recession
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- seignorage
- shutdown costs
- socialism
- statement of cash flows
- stock
- spot market
- spot price
- stock market
- supply
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- tangible asset
- target return pricing
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- tight money policy
- trade deficit
- trade surplus
- trust
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- unfair competition
- variable costs
- white-collar workers
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Age of Inventory
Age of inventory is a measure of the number days a firm holds inventory.
Age of inventory is calculated as follows:
Age of Inventory = 365 / Inventory Turnover
According to the formula above, if the inventory turnover rate of a firm is 5, then this firm's age of inventory equals to (365/5) 73 days.
Analysts favor shorter ages of inventory for salability and liquidity purposes.
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