Excel Sheet Download 31273

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Sheet 1: Changes in inventories

	
	
	
		General steps:
		

	
	
		Step
		

	
	
		1
		Segregate the book values of inventories at the opening and closing dates of the period by accounting method used. Apply any adjustments needed(e.g., markup for operating surplus in the case of work in progress and finished goods or a coverage multiplier).
	
	
		2
		Techniques for FIFO and weighted-average cost accounting
	
	
		2a
		Construct an appropriate price deflator to convert book values of inventories into volumes. Assume how long goods are held in inventories (or stock holding period), and appropriate prices for the goods held in inventory
	
	
		2b
		Calculate constant price values by dividing the book value of inventories by the appropriate price deflator
	
	
		2c
		Take the difference between the constant price values of the book values of inventories at the beginning and end of the period (notionally equivalent to the change in quantities of inventories between the beginning and end of the accounting period)
	
	
		2d
		Volume change in the stock of inventories is multiplied by an average price index for the current accounting period
	
	
		3
		Techniques for LIFO accounting method
	
	
		4
		Calculate totals by adding together the changes in inventories from each accounting methods
	



Sheet 2: Step 1

	
	
	
		STEP 1
		

		

		

		

		

	
	
		

		

		

		

		

		

	
	
		Segregate the book values of inventories at the opening and closing dates of the period by accounting method used. 
		

		

		

		

		

	
	
		

		Year
		Book value of inventories
		FIFO
		Weighted-average
		LIFO
	
	
		

		2014
		 2,000 
		 1,500 
		 333 
		 167 
	
	
		

		2015
		 3,000 
		 2,160 
		 600 
		 240 
	



Sheet 3: Step 2

	
	
	
	
	
		STEP 2a
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Construct an appropriate price deflator to convert book values of inventories into volumes. 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Constructing deflators for book values of inventories implies taking into account that the values are 
implicitly based on a weighting 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		of the prices of the product at the time the goods entered into inventory.
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Assume stock holding period
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		Number of months of sales (withdrawals) required to sell all the goods currently held in inventory
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		Number of months worth of entries required to make-up the inventory
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		e.g., turnover rate = monthly inventories / monthly sales
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Turnover rates
		December
		January
		February
		March
		April
		May
		June
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Inventories
		150,472
		147,574
		138,659
		139,080
		149,974
		153,211
		152,160
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Sales
		36,346
		35,819
		33,902
		34,005
		36,490
		37,644
		36,932
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Turnover rates
		4.14
		4.12
		4.09
		4.09
		4.11
		4.07
		4.12
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Illustration of uniform stock building pattern:
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		December
		January
		February
		March
		April
		May
		June
		July
		August
		September
		October
		

		

		

		

		

		

		

		

		

		

		

	
	
		December
		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		January
		

		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		February
		

		

		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		March
		

		

		

		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		April
		

		

		

		

		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		May
		

		

		

		

		

		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

		

	
	
		June
		

		

		

		

		

		

		1
		1
		1
		1
		0.12
		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Apply the turnover rate to the monthly prices in order to obtain a weighted-average of the prices during the turnover period.
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		Weights
		Weights (WAC)
		Adjusted Weights (WAC)
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-10
		

		 0.02 
		 0.02 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-9
		

		 0.03 
		 0.03 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-8
		

		 0.03 
		 0.04 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-7
		

		 0.04 
		 0.05 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-6
		

		 0.05 
		 0.06 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-5
		

		 0.07 
		 0.07 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-4
		 0.03 
		 0.08 
		 0.09 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-3
		 0.24 
		 0.10 
		 0.11 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-2
		 0.24 
		 0.13 
		 0.14 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t-1
		 0.24 
		 0.16 
		 0.17 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Month t
		 0.24 
		 0.20 
		 0.22 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Total
		 1.00 
		 0.91 
		 1.00 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		
 
		
		
	
		

		

		

		

		

		

		

		

		

		

		

		
	
		FIFO cost index
		

		

		

		

		

		

		

		

		

		Weighted-average cost index
		
	
		Year
		Month
		Price Commodity A
		Price Commodity B
		Monthly Price Index
		Average annual price index
		Monthly cost index
		

		

		Year
		Month
		
	
		2014
		January
		101.5
		101.4
		101.4
		103.7
		

		

		

		2014
		January
		101.5
		101.4
		101.4
		103.7
		

		

		

		105.1
		107.4
		

		

		

	
	
		

		February
		102.7
		102.1
		102.3
		

		

		

		

		

		February
		102.7
		102.1
		102.3
		

		

		

		

		106.6
		

		

		

		

	
	
		

		March
		103.1
		103.0
		103.0
		

		

		

		

		

		March
		103.1
		103.0
		103.0
		

		

		

		

		106.8
		

		

		

		

	
	
		

		April
		103.8
		103.4
		103.6
		

		

		

		

		

		April
		103.8
		103.4
		103.6
		

		

		

		

		107
		

		

		

		

	
	
		

		May
		104.5
		104.5
		104.5
		

		103.3
		

		

		

		May
		104.5
		104.5
		104.5
		

		

		

		

		107.2
		

		

		

		

	
	
		

		June
		105.0
		103.5
		104.1
		

		103.8
		

		

		

		June
		105.0
		103.5
		104.1
		

		

		

		

		107.4
		

		

		

		

	
	
		

		July
		105.9
		102.0
		103.6
		

		103.9
		

		

		

		July
		105.9
		102.0
		103.6
		

		

		

		

		107.6
		

		

		

		

	
	
		

		August
		106.4
		101.4
		103.4
		

		103.9
		

		

		

		August
		106.4
		101.4
		103.4
		

		

		

		

		107.8
		

		

		

		

	
	
		

		September
		106.6
		102.0
		103.8
		

		103.7
		

		

		

		September
		106.6
		102.0
		103.8
		

		

		

		

		108
		

		

		

		

	
	
		

		October
		106.8
		102.5
		104.2
		

		103.8
		

		

		

		October
		106.8
		102.5
		104.2
		

		

		

		

		108.2
		

		

		

		

	
	
		

		November
		107.0
		103.7
		105.0
		

		104.1
		

		

		

		November
		107.0
		103.7
		105.0
		

		104.0
		

		

		108.4
		

		0.0
		

		

	
	
		

		December
		107.2
		104.4
		105.5
		

		104.6
		

		

		

		December
		107.2
		104.4
		105.5
		

		104.4
		

		

		108.9
		

		0.0
		

		

	
	
		2015
		January
		107.4
		112.7
		110.6
		118.3
		106.3
		

		

		2015
		January
		107.4
		112.7
		110.6
		118.3
		105.7
		

		

		110.3
		120.3
		0.0
		

		

	
	
		

		February
		107.6
		119.9
		115.0
		

		108.9
		

		

		

		February
		107.6
		119.9
		115.0
		

		107.8
		

		

		112.4
		

		0.0
		

		

	
	
		

		March
		107.8
		116.1
		112.8
		

		110.8
		

		

		

		March
		107.8
		116.1
		112.8
		

		108.9
		

		

		114.4
		

		0.0
		

		

	
	
		

		April
		108.0
		127.3
		119.6
		

		114.2
		

		

		

		April
		108.0
		127.3
		119.6
		

		111.3
		

		

		116.6
		

		0.0
		

		

	
	
		

		May
		108.2
		132.0
		122.5
		

		117.3
		

		

		

		May
		108.2
		132.0
		122.5
		

		113.9
		

		

		119.4
		

		0.0
		

		

	
	
		

		June
		108.4
		118.8
		114.6
		

		117.3
		

		

		

		June
		108.4
		118.8
		114.6
		

		114.2
		

		

		121
		

		0.0
		

		

	
	
		

		July
		108.6
		120.2
		115.6
		

		117.9
		

		

		

		July
		108.6
		120.2
		115.6
		

		114.7
		

		

		122.4
		

		0.0
		

		

	
	
		

		August
		110.0
		121.4
		116.8
		

		117.4
		

		

		

		August
		110.0
		121.4
		116.8
		

		115.4
		

		

		122.1
		

		0.0
		

		

	
	
		

		September
		112.6
		124.1
		119.5
		

		116.8
		

		

		

		September
		112.6
		124.1
		119.5
		

		116.5
		

		

		124.3
		

		0.0
		

		

	
	
		

		October
		114.6
		127.4
		122.3
		

		118.4
		

		

		

		October
		114.6
		127.4
		122.3
		

		118.0
		

		

		125.4
		

		0.0
		

		

	
	
		

		November
		116.0
		129.7
		124.2
		

		120.6
		

		

		

		November
		116.0
		129.7
		124.2
		

		119.6
		

		

		126.7
		

		0.0
		

		

	
	
		

		December
		119.8
		130.2
		126.0
		

		122.8
		

		

		

		December
		119.8
		130.2
		126.0
		

		121.1
		

		

		128.9
		

		0.0
		

		

	
	
		

		Product weights
		40%
		60%
		

		

		

		

		

		

		Product weights
		40%
		60%
		

		

		

		

		

		

		

		

		

		

	
	
		Source: Eurostat-OECD Task Force on Land and other non-financial assets; fictitious data
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		Product weights:
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		Book values are usually reported by establishment (seldom by products)
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		For materials and supplies (input inventories):
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		
 
		
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		For works-in-progress and finished products:
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		A - Survey or census
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		B - "Storable" output in (benchmark) supply table
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		C - Assumption of diagonal structure 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		STEP 2b
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Calculate constant price values by dividing the book value of inventories by the appropriate price deflator
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Year
		FIFO
		Constant price inventories
		WAC
		Constant price inventories
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		2014
		 1,500 
		 1,434 
		 333 
		 319 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		2015
		 2,160 
		 1,759 
		 600 
		 495 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		STEP 2c
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Take the difference between the constant price values of the book values of inventories at the beginning and end of the period 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		(notionally equivalent to the change in quantities of inventories between the beginning and end of the accounting period)
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Year
		FIFO
		Constant price inventories
		WAC
		Constant price inventories
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		2014
		 1,500 
		 1,434 
		 333 
		 319 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		2015
		 2,160 
		 1,759 
		 600 
		 495 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Changes in inventories
		

		 325 
		

		 176 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		STEP 2d
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Volume change in the stock of inventories is multiplied by an average price index for the current accounting period.
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Year
		FIFO
		Constant price inventories
		Current price inventories
		WAC
		Constant price inventories
		Current price inventories
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		2014
		 1,500 
		 1,434 
		

		 333 
		 319 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		2015
		 2,160 
		 1,759 
		

		 600 
		 495 
		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

		

	
	
		Changes in inventories
		

		 325 
		 384 
		

		 176 
		 209

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...Sheet changes in inventories general steps step segregate the book values of at opening and closing dates period by accounting method used apply any adjustments needed eg markup for operating surplus case work progress finished goods or a coverage multiplier techniques fifo weightedaverage cost construct an appropriate price deflator to convert into volumes assume how long are held stock holding prices inventory b calculate constant dividing value c take difference between beginning end notionally equivalent change quantities d volume is multiplied average index current lifo totals adding together from each methods year constructing deflators implies taking account that implicitly based on weighting product time entered number months sales withdrawals required sell all currently worth entries makeup turnover rate monthly rates december january february march april may june illustration uniform building pattern july august september october order obtain during weights wac adjusted month...

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General steps:
Step
1	Segregate the book values of inventories at the opening and closing dates of the period by accounting method used. Apply any adjustments needed(e.g., markup for operating surplus in the case of work in progress and finished goods or a coverage multiplier).
2	Techniques for FIFO and weighted-average cost accounting
2a	Construct an appropriate price deflator to convert book values of inventories into volumes. Assume how long goods are held in inventories (or stock holding period), and appropriate prices for the goods held in inventory
2b	Calculate constant price values by dividing the book value of inventories by the appropriate price deflator
2c	Take the difference between the constant price values of the book values of inventories at the beginning and end of the period (notionally equivalent to the change in quantities of inventories between the beginning and end of the accounting period)
2d	Volume change in the stock of inventories is multiplied by an average price index for the current accounting period
3	Techniques for LIFO accounting method
4	Calculate totals by adding together the changes in inventories from each accounting methods

STEP 1

Segregate the book values of inventories at the opening and closing dates of the period by accounting method used.
	Year	Book value of inventories	FIFO	Weighted-average	LIFO
	2014	2,000	1,500	333	167
	2015	3,000	2,160	600	240

STEP 2a
Construct an appropriate price deflator to convert book values of inventories into volumes.
Constructing deflators for book values of inventories implies taking into account that the values are implicitly based on a weighting
of the prices of the product at the time the goods entered into inventory.

Assume stock holding period
	Number of months of sales (withdrawals) required to sell all the goods currently held in inventory
	Number of months worth of entries required to make-up the inventory


e.g., turnover rate = monthly inventories / monthly sales
Turnover rates	December	January	February	March	April	May	June
Inventories	150,472	147,574	138,659	139,080	149,974	153,211	152,160
Sales	36,346	35,819	33,902	34,005	36,490	37,644	36,932
Turnover rates	4.14	4.12	4.09	4.09	4.11	4.07	4.12

Illustration of uniform stock building pattern:
	December	January	February	March	April	May	June	July	August	September	October
December	1	1	1	1	0.12
January		1	1	1	1	0.12
February			1	1	1	1	0.12
March				1	1	1	1	0.12
April					1	1	1	1	0.12
May						1	1	1	1	0.12
June							1	1	1	1	0.12

Apply the turnover rate to the monthly prices in order to obtain a weighted-average of the prices during the turnover period.

	*Weights*	*Weights (WAC)*	*Adjusted Weights (WAC)*
Month t-10		0.02	0.02
Month t-9		0.03	0.03
Month t-8		0.03	0.04
Month t-7		0.04	0.05
Month t-6		0.05	0.06
Month t-5		0.07	0.07
Month t-4	0.03	0.08	0.09
Month t-3	0.24	0.10	0.11
Month t-2	0.24	0.13	0.14
Month t-1	0.24	0.16	0.17
Month t	0.24	0.20	0.22
Total	1.00	0.91	1.00



FIFO cost index										Weighted-average cost index
Year	Month	Price Commodity A	Price Commodity B	Monthly Price Index	Average annual price index	Monthly cost index			Year	Month
2014	January	101.5	101.4	101.4	103.7				2014	January	101.5	101.4	101.4	103.7		105.1	107.4
	February	102.7	102.1	102.3						February	102.7	102.1	102.3			106.6
	March	103.1	103.0	103.0						March	103.1	103.0	103.0			106.8
	April	103.8	103.4	103.6						April	103.8	103.4	103.6			107
	May	104.5	104.5	104.5		103.3				May	104.5	104.5	104.5			107.2
	June	105.0	103.5	104.1		103.8				June	105.0	103.5	104.1			107.4
	July	105.9	102.0	103.6		103.9				July	105.9	102.0	103.6			107.6
	August	106.4	101.4	103.4		103.9				August	106.4	101.4	103.4			107.8
	September	106.6	102.0	103.8		103.7				September	106.6	102.0	103.8			108
	October	106.8	102.5	104.2		103.8				October	106.8	102.5	104.2			108.2
	November	107.0	103.7	105.0		104.1				November	107.0	103.7	105.0		104.0	108.4		0.0
	December	107.2	104.4	105.5		104.6				December	107.2	104.4	105.5		104.4	108.9		0.0
2015	January	107.4	112.7	110.6	118.3	106.3			2015	January	107.4	112.7	110.6	118.3	105.7	110.3	120.3	0.0
	February	107.6	119.9	115.0		108.9				February	107.6	119.9	115.0		107.8	112.4		0.0
	March	107.8	116.1	112.8		110.8				March	107.8	116.1	112.8		108.9	114.4		0.0
	April	108.0	127.3	119.6		114.2				April	108.0	127.3	119.6		111.3	116.6		0.0
	May	108.2	132.0	122.5		117.3				May	108.2	132.0	122.5		113.9	119.4		0.0
	June	108.4	118.8	114.6		117.3				June	108.4	118.8	114.6		114.2	121		0.0
	July	108.6	120.2	115.6		117.9				July	108.6	120.2	115.6		114.7	122.4		0.0
	August	110.0	121.4	116.8		117.4				August	110.0	121.4	116.8		115.4	122.1		0.0
	September	112.6	124.1	119.5		116.8				September	112.6	124.1	119.5		116.5	124.3		0.0
	October	114.6	127.4	122.3		118.4				October	114.6	127.4	122.3		118.0	125.4		0.0
	November	116.0	129.7	124.2		120.6				November	116.0	129.7	124.2		119.6	126.7		0.0
	December	119.8	130.2	126.0		122.8				December	119.8	130.2	126.0		121.1	128.9		0.0
	Product weights	40%	60%							Product weights	40%	60%
Source: Eurostat-OECD Task Force on Land and other non-financial assets; fictitious data

	Product weights:
	Book values are usually reported by establishment (seldom by products)
	For materials and supplies (input inventories):















	For works-in-progress and finished products:
	A - Survey or census
	B - "Storable" output in (benchmark) supply table
	C - Assumption of diagonal structure




STEP 2b
Calculate constant price values by dividing the book value of inventories by the appropriate price deflator

Year	FIFO	Constant price inventories	WAC	Constant price inventories
2014	1,500	1,434	333	319
2015	2,160	1,759	600	495



STEP 2c
Take the difference between the constant price values of the book values of inventories at the beginning and end of the period
(notionally equivalent to the change in quantities of inventories between the beginning and end of the accounting period)

Year	FIFO	Constant price inventories	WAC	Constant price inventories
2014	1,500	1,434	333	319
2015	2,160	1,759	600	495
Changes in inventories		325		176



STEP 2d
Volume change in the stock of inventories is multiplied by an average price index for the current accounting period.

Year	FIFO	Constant price inventories	Current price inventories	WAC	Constant price inventories	Current price inventories
2014	1,500	1,434		333	319
2015	2,160	1,759		600	495
Changes in inventories		325	384		176	209

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