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The number of times a business sells and replaces its stock over a given time period is its inventory turnover ratio. The inventory turnover ratio, also sometimes called stock turns or inventory ...
Stock turnover also indicates the briskness of the business. The purpose of increasing inventory turns is to reduce inventory for three reasons. Increasing inventory turns reduces holding cost. The organization spends less money on rent, utilities, insurance, theft and other costs of maintaining a stock of good to be sold.
Average Days to Sell Inventory = Number of Days a Year / Inventory Turnover Ratio = 365 days a year / Inventory Turnover Ratio. This ratio estimates how many times the inventory turns over a year. This number tells how much cash/goods are tied up waiting for the process and is a critical measure of process reliability and effectiveness.
For example, suppose a put option with a strike price of $100 for ABC stock is sold at $1.00 and a put option for ABC with a strike price of $90 is purchased for $0.50, and at the option's expiration the price of the stock or index is greater than the short put strike price of $100, then the return generated for this position is:
Some options strategies can allow you to buy stock at better prices. For example, a strategy such as writing puts allows you to collect a premium for the potential to buy a stock at a lower price.
The inventory turnover ratio can direct timing and size of reorders, identify slow-selling products to mark down for quick sale and inform individual item purchasing decisions. How to Calculate ...
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