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Definition of Days Sales in Inventory

Definition: What is Days Sales in Inventory?

Days sales in Inventory also known as Days Inventory Outstanding. Days in inventory is the number of days which company takes to sell it all inventory.

DSI ratio shows the days of the current stock of the company will last.

Definition of Days Sales in Inventory

This ratio is used to measure the value, liquidity, and cash flow of the business. Because of these 3 measurements of this reason investors and creditors consider this ratio important.

Investors and creditors use this ratio to measure the worth of the inventory. Current or fresh inventory is more valuable than the older inventory.

From this ratio, it is easily found that how much fresh the inventory of the company. Here you can learnĀ Days Sales in Inventory Formula.

Financial Ratio is a forum where you will learn about all ratios definitions and formulas.

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