Inventory

Inventory in the financial statements

Inventory is a balance-sheet line item: a balance at a date, with a debit balance in the ledger.

Inventory in Business Central

How the accounts are selected

• Category Inventory (6) and every category below it

12 posting accounts in total.

Posting accounts

• 10001 TOTAL ASSETS
  • 14000 Inventories, Products and work in Progress
    • 14100 Supplies and Consumables
    • 14110 Raw Materials
    • 14120 Products in Progress
    • 14130 Finished Goods
    • 14140 Resale Items
    • 14160 Advanced Payments for goods and services
    • 14170 Other Inventory Items
    • 14200 Work in Progress
      • 14210 Work in Progress, Finished Goods
      • 14220 WIP Job Sales
      • 14230 WIP Job Costs
      • 14240 WIP, Accrued Costs
      • 14250 WIP, Invoiced Sales

Metrics using inventory

• Free Cash Flow to Equity (through another metric): Net profit − change in non-current assets − change in Trade Working Capital + change in financial debt
• Free Cash Flow to Firm (through another metric): EBIT − Income tax − change in non-current assets − change in Trade Working Capital
• Inventory Turnover: Cost of sales ÷ average inventory
• Trade Working Capital: Trade receivables + Inventory − Trade payables