Beginning Inventory Calculator

Beginning Inventory = COGS + Ending Inventory − Net Purchases. This comes from rearranging the inventory flow identity: Beginning Inventory + Net Purchases = COGS + Ending Inventory. If you know any three of the four values, you can solve for the fourth using this relationship.

Usually yes — in a clean accounting system, the ending inventory from one period becomes the beginning inventory of the next. Differences can occur due to inventory write-downs, adjustments, theft corrections, or timing differences between how records are closed. If the numbers do not reconcile, investigate before filing reports.

Net purchases equals gross purchases minus purchase returns, purchase allowances, and purchase discounts received during the period. If you only have gross purchases and no returns or discounts to apply, use the gross figure directly. Using the wrong number here is the most common cause of an incorrect beginning inventory calculation.

Under normal accounting conditions, inventory cannot be negative. A negative result almost always signals one of three problems: COGS is larger than what the period's inventory could support, ending inventory is overstated, or net purchases are understated. Check each input against the source documents before using the result.

Goods available for sale (GAS) equals Beginning Inventory plus Net Purchases — the total inventory that could have been sold during the period. It is the sum that gets divided between COGS (what was sold) and Ending Inventory (what remains). GAS is used to calculate the gross profit ratio and to check inventory record accuracy.

The formula itself is the same regardless of costing method. However, the dollar amounts you plug in — particularly COGS and ending inventory — will differ based on whether you use FIFO, LIFO, or weighted average cost. Make sure all three inputs come from the same costing method and the same period for the result to be internally consistent.