Planning worked example

Inventory Turns with annual cost of goods sold of 4,500,000 $: a worked example

What does the result look like when annual cost of goods sold reaches 4,500,000 $? The full calculation is worked below with real intermediate numbers. Use when working capital and stock levels need a simple metric.

The inputs for this scenario

  • Annual cost of goods sold: 4,500,000 $ (raised for this scenario; the documented default is 1,800,000)
  • Beginning inventory: 320,000 $ (unchanged)
  • Ending inventory: 280,000 $ (unchanged)
  • Days in period: 365 days (unchanged)

Working through the calculation

  • Applying the documented formula (Average inventory = (beginning + ending inventory) รท 2) to the inputs above produces each figure below.
  • At this operating point the engine returns 15 turns / yr for inventory turns, the number this scenario is built around.
  • At this operating point the engine returns 24.33 days for days inventory.
  • At this operating point the engine returns 300,000 $ for average inventory.
  • At this operating point the engine returns 12,329 $ / day for cogs per day.

How this compares with the baseline

  • Against the tool's baseline example, where annual cost of goods sold sits at 1,800,000 $ and the headline result is 6 turns / yr, this scenario comes in 150% above the baseline at 15 turns / yr.
  • A figure at this level is achievable when annual cost of goods sold is genuinely sustained, not just peaked for a shift. A two-point average of beginning and ending inventory can mask seasonal swings; for spiky demand use a monthly average instead of just two snapshots.

Results at a glance

  • Inventory turns: 15 turns / yr (headline result)
  • Days inventory: 24.33 days
  • Average inventory: 300,000 $
  • COGS per day: 12,329 $ / day

Run it with your numbers

  • Every input above is editable in the live Inventory Turns calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.