Inventory Value Calculator
Click here to get more Free Online Business Calculators
Click here for more Supply Chain and Inventory Calculators
Quick Guide to Use This Calculator
- Select the inventory costing method (FIFO or LIFO) and currency.
- Enter the unit price and quantity for each purchase made.
- Click “Add Fields” if you have more purchases to include.
- Enter the total units sold and the selling price.
- Click “Calculate” to see the results including Total Revenue, COGS, and Remaining Inventory Value.
- Use “Reset” to clear all fields and start over.
Formula
FIFO model
Total revenue = Total units sold x selling price
COGS = the cost of the units sold, taken from the earliest purchase first, then the next one, and so on until all units sold are covered
Remaining inventory value = the value of the units left, which are the most recent purchases
LIFO model
Total revenue = Total units sold x selling price
COGS = the cost of the units sold, taken from the latest purchase first, then the one before it, and so on until all units sold are covered
Remaining inventory value = the value of the units left, which are the earliest purchases
Worked example: purchases of 100 units at 10, 150 at 12 and 200 at 13, with 220 units sold. FIFO: COGS = 100 × 10 + 120 × 12 = 2,440, and the 230 units left are worth 30 × 12 + 200 × 13 = 2,960. LIFO: COGS = 200 × 13 + 20 × 12 = 2,840, and the units left are worth 130 × 12 + 100 × 10 = 2,560. Under FIFO, “the items remaining in inventory at the end of the period are those most recently purchased” (IAS 2, paragraph 27). IAS 2 does not permit LIFO; it is allowed under US GAAP.
FIFO Model:
Calculating COGS (Cost of Goods Sold):
Start with the earliest purchases (first-in).
Iterate over each purchase, considering the unit price and quantity purchased.
Multiply the units sold by the unit price of the corresponding purchase.
Continue this process until the total units sold are accounted for or until there are no more purchases left.
Sum up the total cost of goods sold from these purchases.
Calculating Remaining Inventory Value:
After calculating COGS, the remaining inventory value is the total value of the inventory that hasn’t been sold yet.
This can be calculated by summing the total value (unit price * quantity) of all remaining inventory items.
LIFO Model:
Calculating COGS (Cost of Goods Sold):
Start with the latest purchases (last-in).
Iterate over each purchase, considering the unit price and quantity purchased.
Multiply the units sold by the unit price of the corresponding purchase.
Continue this process until the total units sold are accounted for or until there are no more purchases left.
Sum up the total cost of goods sold from these purchases.
Calculating Remaining Inventory Value:
After calculating COGS, the remaining inventory value is the total value of the inventory that hasn’t been sold yet.
This can be calculated by summing the total value (unit price * quantity) of all remaining inventory items.
What is an inventory value Calculator?
Inventory Value Calculator helps businesses determine their Cost of Goods Sold (COGS) and remaining inventory value based on different costing methods (FIFO or LIFO).
Who Can Use This Calculator?
Business owners, inventory managers, accountants, or anyone involved in managing inventory and calculating COGS can use this calculator to streamline their inventory valuation process.
Which Industries Can Use This Calculator?
Industries with inventory management needs such as retail, manufacturing, wholesale, and distribution can benefit from using this calculator.
Benefits of Using This Calculator
- Streamlines inventory valuation process.
- Provides accurate COGS calculation based on selected costing methods.
- Helps in making informed decisions about inventory management and pricing strategies.
- Offers flexibility with multi-currency support.
FAQs
Can I use this calculator for any currency?
Yes, you can select from a range of currencies available in the dropdown menu.
How do I add more purchase fields?
Click the “Add Fields” button to dynamically add more input fields for additional purchases.
Conclusion
This Inventory Value Calculator offers a user-friendly interface for businesses to efficiently manage their inventory valuation process.
By providing accurate calculations based on selected costing methods, it empowers users to make informed decisions regarding inventory management and pricing strategies.
Whether in retail, manufacturing, or distribution, this tool can be valuable for optimizing inventory-related processes and financial decision-making.
Using Google Search? Add erp-information.com as a preferred source.