I make pet bandanas. What do I include in the inventory count? Do I include only the items that are included in the finished product?

There are three primary components that make up inventory costs: ordering costs, carrying costs, and stockout costs. These costs take into account procurement, storage and warehousing fees, and the costs associated to not having enough inventory to meet demand.

For more information please refer to CRA link: Inventory and cost of goods sold 

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