how to calculate ending finished goods inventory

how to calculate ending finished goods inventory is a crucial process for businesses involved in manufacturing or retail. The ending finished goods inventory represents the value of goods that have been completed but not yet sold by the end of a reporting period. To calculate it, businesses typically start with the beginning inventory, add the cost of goods manufactured during the period, and subtract the cost of goods sold. The formula for ending finished goods inventory is: Beginning Finished Goods Inventory + Cost of Goods Manufactured – Cost of Goods Sold = Ending Finished Goods Inventory. This calculation helps businesses assess their stock levels, determine profitability, and make informed decisions about production and sales.