Days Inventory Outstanding (DIO)

Knowledge Center

   

Contents

  1. Summary
  2. Forum
  3. Best Practices
  4. Expert Tips
  5. Resources
  6. Print
 
Days Inventory Outstanding (DIO)

Definition Days Inventory Outstanding (DIO). Description


Days Inventory Outstanding (DIO) is a financial performance ratio, which indicates how long it takes a company to turn its inventory into sales.


Although the average DIO varies from one industry and region to another, it can be said that the lower the DIO, the more efficient a company is.


Calculation of Days Inventory Outstanding. Formula

The DIO ratio is calculated as follows:


DIO = (Inventories / Cost of Goods Sold in Accounting Period) x Days in Accounting Period


In this formula, the days in accounting period are typically 90 days for quarterly statements or 365 days for yearly statements.


DIO forms one part of the Cash Conversion Cycle, which represents the length of time that it takes a company to convert resource inputs into cash flows.


Days Inventory Outstanding (DIO) is also known as Days Sales of Inventory (DSI), Days Inventory Held (DIH), Days in Inventory (DII) and Days Inventory on Hand (DOH).


Days Inventory Outstanding Forum
  Ideal Inventory Turnover Ratio
What should be the ideal inventory turnover ratio in manufacturing industry and in a service industry? How can we achieve such an ideal inventory turnover ratio?...
     
 
  Zero Level Days Inventory Outstanding (DIO) is is the Ultimate Goal
As mentioned in the definition '... The lower the DIO, the more efficient a company is...'
You can read this also in a spirit of continuous improvement: if your Days Inventory Outstanding is now 40,5, then it should become next year 35. If it is...
     
 
  What is the Meaning of a Particular Value of Days Inventory Outstanding (DIO)?
I would like to know: if my DIO is 40.5 then what can be interpreted from this? Is this good, bad, poor or do I need some contigency plan?...
     
 

Days Inventory Outstanding Special Interest Group


Special Interest Group

 

Best Practices - Days Inventory Outstanding Premium

Expert Tips - Days Inventory Outstanding Premium

Resources - Days Inventory Outstanding Premium

Financial Statement Analysis | Ratio Analysis

This presentation provides insights in Financial statement and ratio analysis, and includes the following sectios:
1. Financial analysis
2. ...
Usage (application): Ratio Analysis, Finanical Statement Analysis
 

Managing your Inventory: Quick Introduction to Just in Time, Stock Review and ABC Analysis

This video gives a brief introduction to three popular Inventory Management Techniques:
1. JIT (Just in Time):
Involves having orders arrive...
Usage (application): Basic Understanding of 3Inventory Management Techniques
 
 

News

Days Inventory Outstanding
     
 

Videos

Days Inventory Outstanding
     
 

Presentations

Days Inventory Outstanding
     
 

More

Days Inventory Outstanding
     
Special Interest Group Leader

You here


 

Return to Management Hub: Finance & Investing


More on Management  |  Return to Management Dictionary  | 

 

This ends our Days Inventory Outstanding (DIO) summary and forum.

About 12manage | Advertising | Link to us | Privacy | Terms of Service
Copyright 2016 12manage - The Executive Fast Track. V14.1 - Last updated: 9-12-2016. All names tm by their owners.