Is TurboTax "Cost of Purchases" the same as reporting the "Value of Inventory (using the cost method)"? Is it okay to report the same number/cost in both places?

[KittyM · Accepted solution]

"Cost of Purchases" is the amount you paid to buy items for resale during the year.  

"Value of Inventory (using the cost method)" is the dollar value of merchandise still on hand (not sold) at year-end, using the price you paid for it.  

These numbers are generally not the same; the only time they would be is if you purchased items, but sold nothing.  Your year-end inventory becomes your beginning inventory for the next tax year.  Keeping an accurate inventory makes sure that you report income and pay taxes on it in the correct year.

[johnwmaier]

Thank you Kitty for the detailed explanation! - Linz