Beginning inventory denotes a company's good value which it has for its sale during the starting of an inventory accounting period.
A company sold its good for $10000 and purchased new inventory for $5000. Ending inventory balance was $20000. Calculate the Beginning Inventory cost of that product.
Cost of goods sold = $10000 Purchases = $5000 Ending inventory = $20000
Beginning inventory = Cost of goods sold - Purchases + Ending inventory = 10000 - 5000 + 20000 = 5000 + 20000 = $25000