The cost is the total outlay required to produce a product or carry out a service.
This is the actual value of the item when last purchased, normally expressed in units.
The better method is to combine the total value of investment in stock, old and new, and divide by the total number of units to calculate the average cost.
This is a very accurate method of establishing stock holding.
The net realizable value normally indicates the average value of an item in the marketplace.