Business
Days inventory outstanding
Translate inventory levels into estimated days of sales coverage.
Calculators / Business / Cash conversion cycle
Cash conversion cycle calculator
Estimate the time cash is tied up in an operating cycle.
On this page
Cash conversion cycle45days
Calculator controls
How to calculate
Estimate the time cash is tied up in an operating cycle.
Cash conversion cycle = inventory+receivable-payable
Worked example
Days inventory outstanding: 60; Days sales outstanding: 30; Days payable outstanding: 45.
Cash conversion cycle: 45 days.
Assumptions and limits
Yes. Receiving customer cash before suppliers are paid can result in a negative cycle. It does not alone establish profitability or solvency.
Results are rounded for display; calculations use unrounded values. Read our calculation methodology.
Understanding the result
The cycle combines stock holding and customer collection time, offset by supplier payment time.
When this tool is useful
Estimate the time cash is tied up in an operating cycle.
Understanding your inputs
| Input | What to enter |
|---|---|
| Days inventory outstanding | Enter a number of at least 0 and no more than 3660. |
| Days sales outstanding | Enter a number of at least 0 and no more than 3660. |
| Days payable outstanding | Enter a number of at least 0 and no more than 3660. |
Frequently asked questions
Can the cycle be negative?
Yes. Receiving customer cash before suppliers are paid can result in a negative cycle. It does not alone establish profitability or solvency.