Inventory Valuation Detail Report Analysis

Executive Summary

This inventory valuation report summarizes inventory as of June 2025, covering key product categories (Bedrooms, Carpets/Floorcoverings, Dining Room). Total inventory value is $2,386,149.96 across approx 7,618 units.

The largest value category is Bedroom sets ($1.85M, 77%), dominated by “Regashi Bedroom Set” and "Handcrafted Queen Bed".
Sales activity is present but far less than opening inventory additions, indicating slow inventory turnover.
There are large opening balance adjustments and cost/unit inconsistencies, especially for high-ticket items (e.g., Regashi Bed, Yao Bed, Handcrafted Queen Bed).
Several SKUs (e.g., Barrow Dining Table, Platform Bed) have high unit costs and low sales outflow relative to inventory held.

Key Financial Ratios / KPIs

Ratio / KPI	Value	Meaning / Insight
Total Inventory Value	$2,386,150	Total $ value of inventory recorded in this period.
Total Units on Hand	7,618	Sum of all quantity in stock. Useful to see scale and risk.
Top 3 SKUs by Value	1. Regashi Bedroom Set: $1,005,794 2. Handcrafted Queen Bed: $325,346 3. Platform Bed: $248,889	Most capital is tied up in these inventory items.
Inventory Turnover Estimate*	~0.09	Very low (Sales outflow in month ÷ Average Inventory) - Indicates slow movement. Example: Total units outflow from main items this month / inventory avg. Estimated 210 units sold from items with >2,000 in stock.
Average Unit Cost (All SKUs)	$313.29	Weighted average across inventory. Wide cost spread between items.

*Estimates only, for illustration; full financials would be required for precise calculation.

Trends, Anomalies & Key Observations

Large Opening Balance Adjustments: Most of the inventory value comes from "Inventory Adjustment" transactions dated 6/30/2025, rather than recent purchases or receipts. This could signal a migration from another system or a one-time correction. High-risk if not properly reconciled.
Low Inventory Turnover: Outflow (sales and fulfillments) is less than 10% of starting units for most high-value items, e.g., Regashi Bedroom Set (-125 out of 465 units (27%); Handcrafted Queen Bed (-25 out of 324 units). Potential overstock/obsolescence.
Unusual Unit Cost Range: Regashi Bed opening unit costs range from $0.26 to over $11,900 per unit, which is a huge variance. Indicates possible data entry or item setup errors.
Transactions of Note:
- Several zero-dollar Cost of Sales in Dining Room (Armless Dining Chair)—could mean free-of-charge sales or bookkeeping errors.
- Barrow Dining Table - Large inventory ($251K) but sales in period of only 14 units (out of 203 on hand).
- Carpets/Floorcoverings - Steady restocking and sales; relatively healthy flows but low value per unit.
Potential Risks:
- Capital Tied Up: Over 80% of value locked in bedroom furniture—risk if these do not sell as projected.
- Obsolete/Excess Stock: Slow-moving or zero-moving SKUs will require markdown or write-off.
- Data Quality Issues: Wide unit cost variance, zero-value sales, and heavy reliance on manual adjustment entries could present audit/compliance risks.

Noteworthy Items & Transactions

Regashi Bedroom Set (465 units, $1M): High average unit cost (~$2,163); but with wide minimum-maximum cost disparity. At least 125 units sold in the period, but adjustment entries make profitability unclear.
Handcrafted Queen Bed (324 units, $325K): Numerous opening balance adjustments, high cost swings ($0.06 to $2,832.76/unit).
Yao Bed (289 units, $181.9K): Many small inventory write-offs, minor negative outflows (may be floor models, EOL, or discount sales).
Mondrian Rug: Reported a number of sales/fulfillments, with restocking entries. Overall appears lower risk.
Dining Room Armless Chair: Units recorded as sold at $0.00/unit: double check for accounting errors.
Barrow Dining Table: Very high-value inventory vs. minimal sales.

Actionable Insights