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                                                Inventory   

Business Solution

Accounting

1. Vouching

2. Journal Entry

3. Bank Reconciliation

4. Party Reconciliation (Debtors & Creditors)

5. Sales, purchase, payment, receipt, debit note, credit note

6. Inventory

7. Costing

8. Cost centres (project wise)

9. Preparation and finalisation of P/L & B/s…etc various things

                                                            INVENTORY

Inventory is a current asset account found on the balance sheet, consisting of all raw materials, work-in-progress, and finished goods that a company has accumulated. It is often deemed the most illiquid of all current assets and, thus, it is excluded from the numerator in the quick ratio calculation.

Types Of Inventory

Finished goods: –

Finished goods inventory is inventory that has been completely built and is ready for immediate sale. Regardless of the inventory cost method mentioned above, finished goods inventory consists of the raw material cost, direct labour, and an allocation of overhead.

Work-in-progress: –

Work-in-progress inventory consists of all partially completed units in production at a given point in time.

Raw materials: –

Raw materials inventory is any material directly attributable to the production of finished goods but on which work has not yet begun. An example would be steel for a car manufacturer.

Key Points Of Inventory

1. It is a part of current assets.

2. Inventory is valued in one of three ways.

3. Inventory management allows business to minimize inventory cost (on needed basis).

4. It’s can be categorized in three different ways like raw materials, work-in-progress and finished goods.

5. Inventory is the raw material used to produce goods as well as the goods that are available for sales.