Small-business finance
Inventory shrinkage and stock variance
Compare expected and physically counted stock for one item, with shortages and surpluses valued at the supplied unit cost.
Your inputs
Complete the fields for your selected method. Zero means intentionally zero, not unknown. Currency selection labels amounts; it does not convert exchange rates.
How this calculation works
unit variance = book units - counted units; value variance = unit variance × unit cost; shortage rate = max(0, variance) / book units
Use one stock item or equivalent units and the same cutoff time. A negative variance is a counted surplus, not negative theft. Unit cost is not selling price; values are cost differences, not lost revenue or automatic accounting adjustments. A variance can reflect transaction timing, count errors, waste, damage or loss; this tool does not determine cause. Include receipts, sales and transfers in the book figure before comparing.
What information do I need?
Use records for the same job, equipment or accounting period. Only the fields for your selected entry method are required. An unknown amount is not zero.
Input definitions and where to find them
- Expected book quantity before stocktake (units): Use the same item, accounting period and unit basis for matching records. Adjust expected units for receipts, sales and transfers up to the physical-count cutoff.
- Physically counted usable quantity (units): Use the same item, accounting period and unit basis for matching records. Count usable stock at the matching cutoff. Do not mix units, cases and individual items.
- Inventory cost per unit on the same basis (selected currency): Use the same item, accounting period and unit basis for matching records. Use your own records or a stated estimate; example figures are not benchmarks.
Use the Where to find this value controls beside the inputs for available work-it-out helpers. Estimates remain your assumptions; a helper does not verify the source figures.
Worked example
Example amounts use US dollars (USD).
Example answer: Book minus counted quantity is 30.000 units for the illustrative inputs below.
Example inputs
- Expected book quantity before stocktake: 1,000.00 units
- Physically counted usable quantity: 970.00 units
- Inventory cost per unit on the same basis: $5.00
- Book minus counted quantity
- 30.000 units
- Book minus counted inventory cost value
- $150.00
- Shortage as share of book quantity
- 3.000 %
- Counted inventory at supplied unit cost
- $4,850.00
- Stocktake direction
- Shortage against book quantity
These illustrative values are not recommended rates or industry averages. Replace every example input with your own figures.
Use the result well
Compare expected and physically counted stock for one item, with shortages and surpluses valued at the supplied unit cost.
Keep inputs on the same scope and time basis. Calculations retain precision internally; displayed values generally round to two decimal places, with extra precision for very small values and whole-unit rounding where required. Economic comparisons describe your supplied assumptions and do not guarantee future results.
This tool provides business arithmetic. It does not approve engineering designs, establish legal or tax treatment, select equipment or certify safe operating conditions.