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Chapter 6 Summary
Topics covered (WHAT)
Chapter 6 discusses paramount concepts in the field of inventory. The issues of the objectives or goals of inventory control are analyzed. The topic further explains the fundamental concepts surrounding the inventory particularly common inventory cost, the systems used in inventory, the main aspects of periodic inventory systems, and various types of inventory costing methods. Lastly, the main issues of establishing the valued inventory, specifically the lower-cost-or-market (LCM) are widely covered, and learners can get the essential information regarding comprehension of inventory.
Importance of topics covered (the WHY they’re important)
Inventory is very a vital aspect of business because it ensures that organizational management maintains the right balance of the entire stock in the warehouse. It enables the entrepreneurs or proprietors to understand what they have in stock and when it is available in the warehouse. The inventory helps in tracking down stock going in and out hence generally aiding in preventing the fraud, speeding up the fulfillment, and lowering the cost. Through the use of cost flow, the accountant in an organization can enter the appropriate data in the balance sheet and the income statement. The inventory also has major indicators of showing when there is excess usage in the warehouse, which likely triggers profit losses whenever the goods expire. Understanding the lower-of-cost- or market ensures that the normal errors of reporting inventory are controlled hence enhancing the profit-making in an organization.

Inventory control is, in essence, a vital tool leading to the prosperity of the business organization. Failure to fully understand inventory might lead to a business loss because the trader cannot be able to account the performance of the business.