Calculate FIFO cost of goods sold from multiple purchase lots, then inspect the exact sold layers, ending inventory layers, and the remaining inventory value after units sold are allocated.
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Inventory Costing
A FIFO calculator for inventory applies the first-in first-out cost-flow assumption, which means the earliest purchase costs are assigned to the units sold first. The result is not just one total. It also shows which lots were consumed, what remains in ending inventory, and how much value is still sitting in stock after the sale allocation.
FIFO does not attempt to trace physical stock movement. It is a cost-flow assumption used to assign inventory costs to cost of goods sold and ending inventory. Under FIFO, the oldest recorded lot costs are released first when units are sold.
That means the sold-layer table is often as important as the headline COGS figure. It shows exactly which cost layers were consumed and which purchase lots remain in ending inventory after the period's sales are assigned.
The calculator sorts through the purchase lots in the order you enter them, treating the first row as the oldest lot. Units sold are applied to the earliest lot until it is exhausted, then to the next lot, and so on until all units sold have been assigned.
The cost assigned to sold units becomes FIFO cost of goods sold. Any units left in later rows remain in ending inventory at their own lot cost. This is why FIFO can produce very different COGS and ending inventory values from weighted-average or LIFO methods when purchase costs have changed materially over time.
FIFO COGS = Sum of the earliest lot costs assigned to units sold
The cost of goods sold is built by consuming the oldest purchase layers first.
Ending inventory value = Sum of the remaining lot costs after FIFO allocation
Any unconsumed units stay in ending inventory at their recorded purchase-layer cost.
Suppose the first lot contains 80 units at 16, the second contains 90 units at 18, and the third contains 70 units at 20. If 145 units are sold, FIFO consumes the full first lot and then 65 units from the second lot.
In that example, FIFO COGS comes from the lower-cost early layers first, while the remaining 25 units in the second lot and all 70 units in the third lot stay in ending inventory. When purchase costs are rising, FIFO often leaves newer, higher-cost layers in ending inventory and produces a lower COGS than a later-cost method would.
FIFO is only one inventory-costing method. The most informative comparison is often between FIFO and the company's broader accounting policy, margin trends, and inventory age. If purchase costs are volatile, the choice of cost-flow method can materially change reported gross margin and ending inventory values.
Use the calculator as a lot-allocation and planning aid. For reporting and tax decisions, confirm the permitted inventory method and disclosure requirements in your jurisdiction and accounting framework.
Further reading
Frequently asked questions
Not necessarily. FIFO is a cost-flow assumption for accounting. Physical stock rotation may or may not match the accounting layer sequence exactly.
Because the earlier, cheaper layers are released to cost of goods sold first, leaving the newer, higher-cost layers in ending inventory.
Yes. Add each purchase lot in chronological order. The sold-layer and ending-layer tables expand so you can see the exact FIFO allocation across all recorded lots.
No. The right method depends on the accounting framework, tax rules, and the policy adopted by the business. This calculator shows FIFO mechanics, not reporting advice.
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