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ReportDear all,
In the report, Gross margin return on inventory investment by products/category,
Calculating GMROI
GMROI = (Annual sales X Gross margin %) / (Average inventory cost)
Hence, I have calculated for a year, I choose the valued fiscal year in the report parameters.
Annual sales - Total amount of sales for an item.
Gross margin percentage - It denotes the amount gain or loss from the total amount of purchase for an item.
Revenue - Amount of sales for an item.
For the gross margin percentage, have to do certain calculation for get the value.
Calculating Gross margin %
= (Gross margin amount divided by revenue) and multiplied by 100.
My question,
How to calculate the Average inventory cost for GMROI calculation?
Best Regards,
Hem
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