Calculating Turnover Ratio in Excel
Now, let's break down the steps to calculate turnover ratio using Excel:
Step 1: Gather the Data
Create a table in Excel with columns for Date, Net Sales, Opening Inventory, and Closing Inventory. Ensure that your data covers the desired time frame.
Step 2: Calculate Average Inventory
In a new column, calculate the average inventory using the formula:
Average Inventory = (Opening Inventory + Closing Inventory) / 2
Step 3: Calculate Turnover Ratio
In the next column, calculate the turnover ratio using the formula:
Turnover Ratio = Net Sales / Average Inventory