Stock Valuation Methods for Shop Owners

How do you value the stock sitting in your shop? Here are the common methods.

FIFO (First In, First Out)

Assumes you sell oldest stock first. Common for FMCG with expiry dates.

Weighted Average

Average cost of all units. Simpler for mixed batches.

Why It Matters

• Profit calculation – Cost of goods sold affects profit
• Tax – GST and income tax depend on valuation
• Insurance – Stock value for coverage
• Loans – Banks may ask for inventory value

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