Beginning Inventory - BI

DEFINITION of 'Beginning Inventory - BI'

The book value of goods, inputs or materials available for use or sale at the beginning of an inventory accounting period. A firm's beginning inventory represents all the "widgets" the company can contribute towards generating revenue for a forward-looking period. Companies almost universally keep close tabs on their inventory numbers at the beginning and end of reporting periods, in order to measure their efficiency and fiscal performance.

BREAKING DOWN 'Beginning Inventory - BI'

Beginning inventory is similar to ending inventory, except that it is adjusted for any accounting discrepancies. BI is an important figure for companies, because they use it to gauge new ordering requirements and to forecast future sales. Company managers can sometimes be evaluated based on their levels of beginning inventory and inventory turnover over a given period of time.

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  5. What does inventory turnover tell an investor about a company?

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