Companies can use the perpetual inventory system to estimate COGS throughout the year. ... You report your beginning inventory, ... you enter the details of the loss on Section B of Form 4684.

In the perpetual inventory system, you figure the cost at the time of each sale instead of at specific intervals. Your cost of goods sold on the 14th is six items times $100, or $600.

Draft tax form for firms to report inventory valuation out The department has released a draft Form 6C for public comments in which inventory valuation must be reported.