1. safeguarding the inventory from damage or theft2. reporting inventory in the financial statements
count of inventory have to be near year-finish to make certain that the quantity of inventory is reported in the financial statements is specific.

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when similar systems of merchandise are got at different unit expenses in the time of a period. in such cases, when an object is offered, it is necessary to determine its expenses utilizing a expense circulation presumption and associated inventory expense circulation technique.
the first devices purchased are assumed to be offered, and also the ending inventory is comprised of the a lot of current purchases
the last systems are assumed to be purchased and also the finishing inventory is consisted of of the first purchases.

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if the expense of replacing inventory is reduced than its recorded purchase cost, the lower of price or market method is used to worth the inventory.
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