This study aims to evaluate and compare the inventory valuation methods of Average and FIFO (First In, First Out) at Company X, which operates in the field of joint replacement (arthroplasty) and medical equipment distribution. The research employs a descriptive qualitative approach using inventory and sales data from March 2025 as the sample for analysis. The company applies a perpetual inventory system and the average valuation method; however, this study also presents a comparative analysis using the FIFO method. The results indicate that the average method produces a higher ending inventory value and net income compared to FIFO, while the cost of goods sold is lower. These findings differ from previous studies, which suggest that the FIFO method results in higher profits. This discrepancy is attributed to exchange rate fluctuations and the dominance of imported inventory, making the average method more reflective of current acquisition costs. The FIFO method is considered more favorable in terms of tax efficiency due to the lower net income it generates. This study affirms that the company’s inventory valuation method aligns with the provisions of the Pernyataan Standar Akuntansi Keuangan (PSAK) 202.