---
title: "How do I set up BUSY for my new company?"
description: "How do I set up BUSY for my new company?"
canonical: "https://busy.in/faqs/how-do-i-set-up-busy-for-my-new-company-answerid-59668/"
---

# How do I set up BUSY for my new company?

The Stock Valuation method specified here is used for the valuation of closing stock only. It is important to note that the closing stock of one month is the opening stock of next month. Thus, the stock valuation method affects the closing stock/opening stock that appears in inventory reports such as Stock Status report. An exception to the above rule is the opening stock on the first date of the beginning financial year. The opening stock on the first date is valued at the price specified in the Item master.
Step 1: FIFO Costing:For each inventory item, ensure that the oldest units in stock are used first to determine the cost. If the purchased quantity exceeds the available quantity in stock, create separate voucher entries for different batches or purchases to maintain the FIFO order.
Step 2: Calculate Total Value:Multiply the quantities of each item by their respective FIFO costs (i.e., the cost of the oldest units) to calculate the total value of each line item in the voucher entry.
For Example :
Under the First In First Out method, the quantity of item purchased first is assumed to be sold first. In the example the quantity sold on December 15 (first sale) will be assumed to be the quantity that was purchased first on December 1. In this way the valuation of closing stock will be as given here:
Quantity from first purchase 20 Pcs. @ Rs.100 = Rs. 2,000
Quantity from second purchase 100 Pcs. @ Rs.200 = Rs. 20,000
Total 120 Pcs. Rs. 22,000

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