How to Calculate Inventory For Your Business

In this video I discuss the accounting equation for calculating inventory:
Beginning Inventory
+ Purchases
- Cost of Goods Sold (COGS)
= Ending Inventory
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Disclaimer: This video is intended for educational purposes only. I am not a lawyer and no content in this video or the comments to this video should be considered tax or legal advice. All viewers should consult their own tax advisor and/or legal counsel before making any decisions.

[@roadiefrodie]

Just what I needed for tax prep - Thanks!

[@tolga7920]

Hello, I would like to start a business in 2020 I have already purchased beginning inventory with my personal money, for tax purposes how can I deduct that amount from my business or show it as purchases? Thank you.

[@MrCPA-ry8mv]

You would need to wait until you actually sold the inventory in 2020. Unfortunately you wouldn’t be allowed to deduct it in 2019.

[@johnnyvegas4583]

What is beginning inventory if I say contribute $4000 of my personal items to the business?

[@MrCPA-ry8mv]

If you contributed personal items to sell with a cost value of $4k, then your beginning value would equal that amount.

[@dannyfinancial214]

Love you

[@SheSellsBySue]

Oh NO! I have to do algebra? HAHA

[@bruzo6505]

How to calculate ending inventory if cogs is not given?

[@MrCPA-ry8mv]

You would probably have to physically count your ending inventory if you didn’t know the beginning value, purchase, and cost of goods sold values.