How is zakat on commercial inventory calculated upon the completion of a hawl (lunar year)—is it based on the purchase price or the selling price, taking into consideration that the selling price may be variable and might not reflect the true value of what is due?

Whoever has trade goods must pay zakat on their value when a year has passed, regardless of the purchase price. These goods are appraised at their selling price at the time zakat becomes due. If the value varies, he is obligated to pay based on the lowest value at which they are appraised. However, if the value of the goods differs based on the method of sale (wholesale or retail), he pays zakat according to the method by which he sells them. And if the seller pays zakat on his goods in a way that is more beneficial and abundant for the poor, that is better.