Beginning and ending inventory calculation is an important part of accounting and business operations. This calculation helps businesses track their inventory levels over a given period of time, so that they can understand how much inventory was on hand at the beginning of the period, and how much inventory there was remaining at the end. By tracking these figures, businesses can measure their resource utilization and make better decisions about purchasing and stocking levels. Knowing the beginning and ending inventory levels also allows companies to easily calculate the cost of goods sold (COGS). In short, understanding your beginning and ending inventory is key to running a successful business.