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Inventory Cost

Value stock on hand and the cash tied up in inventory.

About Inventory Cost

Inventory is valued by multiplying units by unit cost, with monthly movement and a standard holding charge. Inventory is cash until it sells, so knowing its value and burn rate keeps you from overordering.

Formula

Inventory Cost

Value = units x unit cost; sell-through = units / days x 30

holding cost
Rough 2%/month cost of storing and financing stock

Worked example

With the default values below, Inventory Cost returns Inventory Value of $20,000. Change any input above and every figure here is recalculated in your browser.

Inputs used

Units on hand
800
Cost per unit
25
Days of stock coveredminimum 1
30

Results

Inventory Value
$20,000
Monthly Sell-Through
800
Est. Holding Cost (mo)
$400

Step by step

  1. 1Values used
  2. 2Inventory Cost
  3. 3Inventory Value= 20,000
  4. 4Monthly Sell-Through= 800
  5. 5Est. Holding Cost (mo)= 400

Assumptions and limits

  • The result is derived only from the 3 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax or compounding frequency into account.
  • Figures are rounded for display to whole numbers, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How is Inventory Cost calculated?

Value = units x unit cost; sell-through = units / days x 30 Inventory is valued by multiplying units by unit cost, with monthly movement and a standard holding charge.

Why does Inventory Cost matter?

Inventory is cash until it sells, so knowing its value and burn rate keeps you from overordering.

What values do I need to enter?

This calculator takes 3 inputs: Units on hand, Cost per unit, Days of stock covered. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.

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Inventory Cost – Calculate Inventory Value | Calcrivo