Question: what needs to be considered when not only counting inventory, but likewise in the final valuation of inventory? Why is the inventory valuation so important

what needs to be considered when not only counting inventory, but likewise in the final valuation of inventory? Why is the inventory valuation so important for accounting purposes (for example, how would inventory errors affect the balance sheet and income statement - beginning vs. ending inventory). (**Hint - ending inventory for the initial period then becomes beginning inventory in the next reporting period - and both are used in the computation of cost of goods sold, used to compute gross profit in the income statement)

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