Fifo Periodic Inventory Calculator

Periodic FIFO Method:

\[ \text{Cost of Goods Sold} = \sum(\text{Earliest purchases} \times \text{Units sold}) \] \[ \text{Ending Inventory} = \sum(\text{Remaining purchases} \times \text{Unit cost}) \]

Cost of Goods Sold (COGS):

Ending Inventory Value:

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1. What is Periodic FIFO?

The Periodic FIFO (First-In, First-Out) method assumes that the oldest inventory items are sold first. It's calculated at the end of an accounting period rather than after each sale.

2. How Does the Calculator Work?

The calculator uses the Periodic FIFO method:

\[ \text{COGS} = \sum(\text{Earliest purchases} \times \text{Units sold}) \] \[ \text{Ending Inventory} = \sum(\text{Remaining purchases} \times \text{Unit cost}) \]

Steps:

Sort all purchases by date (oldest first)
Allocate sold units to the oldest purchases first
Calculate COGS from the allocated units
Calculate ending inventory from remaining units

3. Importance of FIFO Calculation

Details: FIFO provides a more accurate representation of inventory costs during periods of inflation, matches actual flow of goods in many businesses, and affects both balance sheet (inventory) and income statement (COGS) values.

4. Using the Calculator

Instructions:

Enter purchases in format: date, units, cost (one per line)
Example: 2023-01-15, 100, 10.50
Enter total units sold during the period
Click Calculate to get COGS and ending inventory value

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between periodic and perpetual FIFO?
A: Periodic FIFO calculates at period end while perpetual FIFO updates after each sale. This calculator uses periodic FIFO.

Q2: How does FIFO affect taxes during inflation?
A: FIFO typically results in lower COGS and higher taxable income during inflation compared to LIFO.

Q3: When should I use FIFO vs LIFO?
A: FIFO better matches physical flow for perishable goods. LIFO may be preferred for tax advantages during inflation (US only).

Q4: How should I format dates?
A: Use YYYY-MM-DD format for best results (e.g., 2023-05-20).

Q5: What if my sales exceed purchases?
A: The calculator will use all available inventory. COGS will reflect total available inventory cost.