Cost goods sold with last-in, first-out layers.
Please do not make financial decisions based on these results.
What is the LIFO Calculator for Inventory?
Cost goods sold with last-in, first-out layers. To use the LIFO Calculator for Inventory, enter oldest layer units, oldest layer unit cost, middle layer units, middle layer unit cost, newest layer units, newest layer unit cost and a few more values; it returns lifo cost of goods sold, ending inventory value, and shows them instantly as you type.
Where the LIFO Calculator for Inventory fits
Cost goods sold with last-in, first-out layers. The main figure it returns is the LIFO cost of goods sold, worked out from the values you enter.
It belongs with the other accounting & microeconomics tools. If you are comparing options or checking a result from another angle, try the Inventory Turnover Calculator, Ending Inventory Calculator or the DIO Calculator.
How to use the LIFO Calculator for Inventory
- Enter your numbers. The inputs are Oldest layer units, Oldest layer unit cost ($), Middle layer units, Middle layer unit cost ($), Newest layer units, Newest layer unit cost ($), Units sold. Use numbers from the same accounting period so the ratios are comparable. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the LIFO cost of goods sold, and the cards below show Ending inventory value. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the LIFO Calculator for Inventory using the default values shown in the calculator above:
Inputs
| Oldest layer units | 100 |
|---|---|
| Oldest layer unit cost ($) | 10 |
| Middle layer units | 150 |
| Middle layer unit cost ($) | 12 |
| Newest layer units | 120 |
| Newest layer unit cost ($) | 14 |
| Units sold | 260 |
Results
| LIFO cost of goods sold | $3,360.00 |
|---|---|
| Ending inventory value | $1,120.00 |
With these inputs the calculator returns LIFO cost of goods sold: $3,360.00. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Oldest layer units from 100 to 120 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| LIFO cost of goods sold | $3,360.00 | $3,360.00 | 0% |
| Ending inventory value | $1,120.00 | $1,320.00 | +17.9% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the LIFO Calculator for Inventory reports LIFO cost of goods sold and ending inventory value. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
Is LIFO allowed internationally?
IFRS does not permit LIFO; US GAAP does.
Which accounting standard do the formulas follow?
They use the common textbook definitions that apply under both US GAAP and IFRS unless a tool says otherwise.
Why use average balances?
Ratios that compare a flow (sales, income) with a balance (assets, equity) are fairer when the balance is averaged over the period.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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