Something to note in your everyday accounting is that your inventory should always be accounting it’s lower or either cost or net realisable value. I know that you may have already known that, but are you really accounting your inventory accordingly?

If you’re adding some expenses to your cost of inventory you’re treating it most probably pretty accurately. That is of course if those expenses are really relating to inventories at hand. However, when you’re comparing the cost against the selling price of this specific item, are you earning profit or loss? Is the realisable value higher than the cost? 

A definite indication that your inventory is in wrong price, wrong cost is when your gross margin is in fact negative. If your business is making operating losses, it’s also an indication that either your pricing is off or your expenses are too high.

To understand if you’ve got a problem, you must compare your selling price with the cost of the specific good and then you have an overview if your inventory is in its correct value. And not just that, but you will also see if you should also change your pricing to your customers. There’s a reason for each and every loss.