Excess Used Vehicle Inventory Calculation

Excess Used Vehicle Inventory Calculation
(dollars)

Formula:

Step One

Dollar Days Supply - Actual	=	Days
*less:*		-
Dollar Days Supply - Goal	=	Days

Difference	=	Days
*multiplied by:*
One Day's Cost of Sales	=	$

Equals EXCESS DOLLARS OF INVENTORY	=	$
*multiplied by:*
Current Interest Rate	=	%

Annualized Cost of Excess Inventory	=	$


(dollars)

*Example Calculation*

Formula:

Step One

Dollar Days Supply - Actual	=	67
*less:*		-
Dollar Days Supply - Goal	=	45

Difference	=	22
*multiplied by:*
One Day's Cost of Sales	=	$ 5,636

Equals EXCESS DOLLARS OF INVENTORY	=	$ 123,992
*multiplied by:*
Current Interest Rate	=	11%

Annualized Cost of Excess Inventory	=	$ 13,639