How to value your inventory
Inventory value = Σ (Quantity on hand × Unit cost)
Closing stock value feeds directly into your P&L (it reduces COGS) and your balance sheet (it's a current asset), so counting and costing it correctly matters. This calculator totals your stock at cost and shows the weighted average cost per unit.
Costing methods in brief
- FIFO — oldest purchases are deemed sold first; closing stock carries recent prices. The most common method in India.
- Weighted average — every unit carries the average cost of all purchases; smooths out price swings.
- Cost or NRV, whichever is lower — accounting standards require writing stock down if its selling value falls below cost.