Ian, really useful video as others. However, why did you divide the total cost by 12? You began with the month inventory cost of $1M and then calculated each line item monthly e.g. damage of $20K per month? Why did you then divide the total by 12 again? May be I am missing something here?
Not sure if this is meaningful to you after 3 years but hey...the $1 million dollar inventory figure is the "average inventory value" of the facility or in other words $1 million dollars is the average inventory level they have on any given day during the year so they are financing $1 million dollars of inventory on average which is an annualized number. All the other costs are also annualized hence the "divide by 12"
Is your inventory value based on sales price or cost of goods (excluding admin & other miscellaneous costs)
Ian, really useful video as others. However, why did you divide the total cost by 12? You began with the month inventory cost of $1M and then calculated each line item monthly e.g. damage of $20K per month? Why did you then divide the total by 12 again? May be I am missing something here?
Not sure if this is meaningful to you after 3 years but hey...the $1 million dollar inventory figure is the "average inventory value" of the facility or in other words $1 million dollars is the average inventory level they have on any given day during the year so they are financing $1 million dollars of inventory on average which is an annualized number. All the other costs are also annualized hence the "divide by 12"
Nicely done.
V. Good