Avitar (Avitar) Inventory Turnover : 1.95 (As of Dec. 2007)

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What is Avitar Inventory Turnover?

Inventory Turnover measures how fast the company turns over its inventory within a year. It is calculated as Cost of Goods Sold divided by Total Inventories. Avitar's Cost of Goods Sold for the three months ended in Dec. 2007 was $0.44 Mil. Avitar's Average Total Inventories for the quarter that ended in Dec. 2007 was $0.23 Mil. Avitar's Inventory Turnover for the quarter that ended in Dec. 2007 was 1.95.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Avitar's Days Inventory for the three months ended in Dec. 2007 was 46.88.

Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue. Avitar's Inventory-to-Revenue for the quarter that ended in Dec. 2007 was 0.45.

Avitar Inventory Turnover Historical Data

The historical data trend for Avitar's Inventory Turnover can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Avitar Inventory Turnover Chart

Avitar Annual Data

Trend

Sep98

Sep99

Sep00

Sep01

Sep02

Sep03

Sep04

Sep05

Sep06

Sep07

Inventory Turnover

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8.89

9.06

8.79

9.72

9.13

Avitar Quarterly Data
	Mar03	Jun03	Sep03	Dec03	Mar04	Jun04	Sep04	Dec04	Mar05	Jun05	Sep05	Dec05	Mar06	Jun06	Sep06	Dec06	Mar07	Jun07	Sep07	Dec07
Inventory Turnover	Get a 7-Day Free Trial															2.36	1.89	2.08	2.07	1.95

Avitar Inventory Turnover Calculation

Avitar's Inventory Turnover for the fiscal year that ended in Sep. 2007 is calculated as

	Inventory Turnover (A: Sep. 2007 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (A: Sep. 2007 )	/ (	(Total Inventories (A: Sep. 2006 )	+	Total Inventories (A: Sep. 2007 ))	/	count )
=	2.269	/ (	(0.272	+	0.225)	/	2 )
=	2.269	/	0.2485
=	9.13

Avitar's Inventory Turnover for the quarter that ended in Dec. 2007 is calculated as

	Inventory Turnover (Q: Dec. 2007 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (Q: Dec. 2007 )	/ (	(Total Inventories (Q: Sep. 2007 )	+	Total Inventories (Q: Dec. 2007 ))	/	count )
=	0.438	/ (	(0.225	+	0.225)	/	2 )
=	0.438	/	0.225
=	1.95

Avitar (OTCPK:AVTI) Inventory Turnover Explanation

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher Inventory Turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

1. Days Inventory indicates the number of days of goods in sales that a company has in the inventory.

Avitar's Days Inventory for the three months ended in Dec. 2007 is calculated as:

Days Inventory	=	Average Total Inventories (Q: Dec. 2007 )	/	Cost of Goods Sold (Q: Dec. 2007 )	*	Days in Period
	=	0.225	/	0.438	*	365 / 4
	=	46.88

2. Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue.

Avitar's Inventory to Revenue for the quarter that ended in Dec. 2007 is calculated as

Inventory-to-Revenue	=	Average Total Inventories (Q: Dec. 2007 )	/	Revenue (Q: Dec. 2007 )
	=	0.225	/	0.505
	=	0.45

Be Aware

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate Inventory Turnover. An average inventory is a better indication.

Avitar Inventory Turnover Related Terms

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Avitar (Avitar) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Avitar Inc (OTCPK:AVTI) » Definitions » Inventory Turnover

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Address

5005 Elbow Drive SW, Suite 207, Calgary, AB, CAN, T2S 1T9

Website

Avitar Inc, through its subsidiary Avitar Technologies, develops, manufactures, and markets products for oral fluid diagnostics, disease and clinical testing, and wound treating.