Inventory Formula is a concept based on the accounting equation that looks at the relationship between assets, liabilities, and equity in terms of inventory. It states that the total assets (or inventory) of an organization must equal the sum of its liabilities and equity. By understanding this concept, businesses are better able to understand their financial structure, analyze liquid assets, and plan for future investments. In other words, it’s like having a roadmap to help guide decisions regarding how to maximize profits and minimize costs. Inventory Formula gives businesses the power to make smarter decisions and be more successful.