Opening inventory is defined as the value of inventory at which point?

Opening inventory is defined as the value of inventory at which point?

• A. At the end of the period
• B. During the period
• C. At the start of the period
• D. The total purchases

Answer: (C)

Opening inventory is the value of stock on hand at the very start of the period. It shows what you begin with before any purchases or usage during that period, and it feeds into the cost-of-goods-sold calculation (Opening inventory plus purchases minus ending inventory equals COGS). For example, if you start with $5,000 worth of inventory, add $3,000 in purchases, and end with $4,000 in inventory, COGS would be $5,000 + $3,000 − $4,000 = $4,000. The other options refer to different points or measures: ending inventory is at the period’s end; total purchases are inflows, not the stock on hand at the start; and “during the period” isn’t a fixed inventory value.

Opening inventory is the value of stock on hand at the very start of the period. It shows what you begin with before any purchases or usage during that period, and it feeds into the cost-of-goods-sold calculation (Opening inventory plus purchases minus ending inventory equals COGS). For example, if you start with $5,000 worth of inventory, add $3,000 in purchases, and end with $4,000 in inventory, COGS would be $5,000 + $3,000 − $4,000 = $4,000. The other options refer to different points or measures: ending inventory is at the period’s end; total purchases are inflows, not the stock on hand at the start; and “during the period” isn’t a fixed inventory value.