| Inventory | Goods held for sale, in production, or as materials/supplies to be consumed in production |
| FIFO (First-In, First-Out) | Cost flow assumption assigning oldest costs to COGS first |
| LIFO (Last-In, First-Out) | Cost flow assumption assigning most recent costs to COGS first; US GAAP only |
| Weighted Average Cost (WAC) | Cost flow method using average cost per unit for the period |
| Specific Identification | Method tracking actual cost of each individual item sold |
| Cost of Goods Sold (COGS) | Beginning inventory plus purchases minus ending inventory |
| Net Realizable Value (NRV) | Estimated selling price minus costs to complete and sell |
| Lower of Cost or NRV | IFRS valuation rule: inventory carried at lower of cost or NRV |
| Lower of Cost or Market | US GAAP valuation rule using replacement cost bounded by NRV ceiling and NRV minus normal margin floor |
| LIFO Reserve | Difference between inventory valued at FIFO and inventory valued at LIFO |
| LIFO Liquidation | Reduction in LIFO inventory layers when units sold exceed units purchased; creates unsustainable profit boost |
| LIFO Conformity Rule | US tax rule requiring LIFO for tax if used for financial reporting |
| Inventory Turnover | COGS divided by average inventory; measures efficiency of inventory management |
| Days of Inventory on Hand (DOH) | 365 divided by inventory turnover; average days to sell inventory |
| Inventory Write-down | Reduction in carrying value when cost exceeds NRV or market |
| Write-down Reversal | IFRS allows reversal of prior inventory write-downs (up to original cost); US GAAP does not |
| Raw Materials | Goods purchased for use in manufacturing |
| Work-in-Progress (WIP) | Partially completed goods in the production process |
| Finished Goods | Completed products ready for sale |
| Periodic Inventory System | Inventory and COGS determined at end of period by physical count |