Inventory Accounting

Inventory accounting pages explain how businesses measure stock, reconcile counts, apply cost-flow assumptions, and carry ending inventory into the statements.

In this section

• Inventory Flow Assumptions
  Accounting terms for FIFO, first-in first-out, and LIFO inventory flow assumptions.
  • FIFO
    FIFO is an inventory cost-flow assumption that assigns the oldest costs to cost of goods sold and leaves newer costs in ending inventory.
  • First-In, First-Out: An Accounting Convention
    An in-depth look into the First-In, First-Out (FIFO) accounting method used for inventory management and cost accounting.
  • LIFO
    LIFO is an inventory cost-flow assumption that assigns the most recent costs to cost of goods sold before older inventory costs.
• Inventory Valuation, Write-Offs, And Work In Progress
  Accounting terms for ending inventory, inventory accounting, inventory valuation, inventory write-offs, lower-of-cost rules, opening stock, and WIP.
  • Inventory Period Flows and Work in Progress
    Inventory flow terms used to distinguish opening stock, ending inventory, and unfinished production.
    • Ending Inventory
      Ending inventory is the inventory remaining at the end of a reporting
    • Opening Stock
      Opening stock is the inventory balance at the start of an accounting
    • Work in Progress: The Balance of Partly Finished Work
      An in-depth exploration of the term 'Work in Progress,' including historical
  • Inventory Valuation and Write-Offs
    Inventory valuation and write-off rules used to measure stock at cost, market, or net realizable value.
    • Inventory Accounting
      Inventory accounting records, values, and tracks stock movements so purchases, production, cost of goods sold, and ending inventory reconcile.
    • Inventory Valuation
      Inventory valuation determines the cost assigned to inventory and cost of goods sold for financial reporting and analysis.
    • Inventory Write-Off
      An inventory write-off removes or reduces inventory when goods are no
    • Lower of Cost and Net Realizable Value Rule
      The lower of cost and net realizable value rule requires inventory to
    • Lower of Cost or Market
      Lower of cost or market is an inventory valuation rule that limits recorded