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Beginning Inventory Calculator

by Zoho Inventory
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Beginning Inventory Calculator

Knowing your beginning inventory is the first step toward managing your stock flow efficiently. This free calculator helps you determine your beginning inventory value in just a few clicks.

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Beginning inventory

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What is beginning inventory?

Beginning inventory is the amount or value of stock that is present at the start of the accounting period. It is valued using one of the four different methods: FIFO, LIFO, weighted average cost, and specific assigned value.

What you need to know?

  • It helps uncover sales and operational trends, helping you track product performance and spot seasonal demand patterns.

  • Beginning inventory is primarily affected by the prior period's ending inventory, inventory write-downs, stock discrepancies, and returns.

  • The beginning inventory for a period is the same as the ending inventory for the previous period.

How is beginning inventory calculated?

Beginning inventory is calculated by taking into account the cost of goods sold, ending inventory and purchases.

Beginning Inventory = (Cost of goods sold + Ending inventory) - Purchases

What's the difference?

Beginning inventory

  • Inventory on hand at the start
  • Comes from the previous period
  • Used to calculate total available stock

Purchases

  • New inventory bought during the period
  • Happens within the current period
  • Added to beginning inventory for calculations

Frequently asked questions

  • Yes, typically. However, adjustments might be needed for returns, damages, or miscounts carried over from the prior period.
  • You should deduct the value of any unusable or obsolete items from your inventory to reflect a more accurate beginning inventory figure.
  • You can use inventory valuation methods such as FIFO (First In, First Out), LIFO (Last In, First Out), or weighted average cost, depending on your accounting system and applicable regulations.
  • At the start of each accounting period, and ideally after performing a physical inventory count or cycle count to confirm accuracy.
  • Since it directly influences COGS, which in turn affects gross profit, an inaccurate beginning inventory can distort taxable income. Proper tracking ensures compliance and prevents audit issues.

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