diff --git a/erpnext/stock/report/stock_ageing/stock_ageing.py b/erpnext/stock/report/stock_ageing/stock_ageing.py
index 0ebe4f9..88e0712 100644
--- a/erpnext/stock/report/stock_ageing/stock_ageing.py
+++ b/erpnext/stock/report/stock_ageing/stock_ageing.py
@@ -3,6 +3,7 @@
 
 
 from operator import itemgetter
+from typing import Dict, List, Tuple, Union
 
 import frappe
 from frappe import _
@@ -10,19 +11,29 @@
 
 from erpnext.stock.doctype.serial_no.serial_no import get_serial_nos
 
+Filters = frappe._dict
 
-def execute(filters=None):
-	columns = get_columns(filters)
-	item_details = get_fifo_queue(filters)
+def execute(filters: Filters = None) -> Tuple:
 	to_date = filters["to_date"]
-	_func = itemgetter(1)
+	columns = get_columns(filters)
 
+	item_details = FIFOSlots(filters).generate()
+	data = format_report_data(filters, item_details, to_date)
+
+	chart_data = get_chart_data(data, filters)
+
+	return columns, data, None, chart_data
+
+def format_report_data(filters: Filters, item_details: Dict, to_date: str) -> List[Dict]:
+	"Returns ordered, formatted data with ranges."
+	_func = itemgetter(1)
 	data = []
+
 	for item, item_dict in item_details.items():
 		earliest_age, latest_age = 0, 0
+		details = item_dict["details"]
 
 		fifo_queue = sorted(filter(_func, item_dict["fifo_queue"]), key=_func)
-		details = item_dict["details"]
 
 		if not fifo_queue: continue
 
@@ -31,23 +42,22 @@
 		latest_age = date_diff(to_date, fifo_queue[-1][1])
 		range1, range2, range3, above_range3 = get_range_age(filters, fifo_queue, to_date, item_dict)
 
-		row = [details.name, details.item_name,
-			details.description, details.item_group, details.brand]
+		row = [details.name, details.item_name, details.description,
+			details.item_group, details.brand]
 
 		if filters.get("show_warehouse_wise_stock"):
 			row.append(details.warehouse)
 
 		row.extend([item_dict.get("total_qty"), average_age,
 			range1, range2, range3, above_range3,
-			earliest_age, latest_age, details.stock_uom])
+			earliest_age, latest_age,
+			details.stock_uom])
 
 		data.append(row)
 
-	chart_data = get_chart_data(data, filters)
+	return data
 
-	return columns, data, None, chart_data
-
-def get_average_age(fifo_queue, to_date):
+def get_average_age(fifo_queue: List, to_date: str) -> float:
 	batch_age = age_qty = total_qty = 0.0
 	for batch in fifo_queue:
 		batch_age = date_diff(to_date, batch[1])
@@ -61,7 +71,7 @@
 
 	return flt(age_qty / total_qty, 2) if total_qty else 0.0
 
-def get_range_age(filters, fifo_queue, to_date, item_dict):
+def get_range_age(filters: Filters, fifo_queue: List, to_date: str, item_dict: Dict) -> Tuple:
 	range1 = range2 = range3 = above_range3 = 0.0
 
 	for item in fifo_queue:
@@ -79,7 +89,7 @@
 
 	return range1, range2, range3, above_range3
 
-def get_columns(filters):
+def get_columns(filters: Filters) -> List[Dict]:
 	range_columns = []
 	setup_ageing_columns(filters, range_columns)
 	columns = [
@@ -164,106 +174,7 @@
 
 	return columns
 
-def get_fifo_queue(filters, sle=None):
-	item_details = {}
-	transferred_item_details = {}
-	serial_no_batch_purchase_details = {}
-
-	if sle == None:
-		sle = get_stock_ledger_entries(filters)
-
-	for d in sle:
-		key = (d.name, d.warehouse) if filters.get('show_warehouse_wise_stock') else d.name
-		item_details.setdefault(key, {"details": d, "fifo_queue": []})
-		fifo_queue = item_details[key]["fifo_queue"]
-
-		transferred_item_key = (d.voucher_no, d.name, d.warehouse)
-		transferred_item_details.setdefault(transferred_item_key, [])
-
-		if d.voucher_type == "Stock Reconciliation":
-			d.actual_qty = flt(d.qty_after_transaction) - flt(item_details[key].get("qty_after_transaction", 0))
-
-		serial_no_list = get_serial_nos(d.serial_no) if d.serial_no else []
-
-		if d.actual_qty > 0:
-			if transferred_item_details.get(transferred_item_key):
-				batch = transferred_item_details[transferred_item_key][0]
-				fifo_queue.append(batch)
-				transferred_item_details[transferred_item_key].pop(0)
-			else:
-				if serial_no_list:
-					for serial_no in serial_no_list:
-						if serial_no_batch_purchase_details.get(serial_no):
-							fifo_queue.append([serial_no, serial_no_batch_purchase_details.get(serial_no)])
-						else:
-							serial_no_batch_purchase_details.setdefault(serial_no, d.posting_date)
-							fifo_queue.append([serial_no, d.posting_date])
-				else:
-					fifo_queue.append([d.actual_qty, d.posting_date])
-		else:
-			if serial_no_list:
-				fifo_queue[:] = [serial_no for serial_no in fifo_queue if serial_no[0] not in serial_no_list]
-			else:
-				qty_to_pop = abs(d.actual_qty)
-				while qty_to_pop:
-					batch = fifo_queue[0] if fifo_queue else [0, None]
-					if 0 < flt(batch[0]) <= qty_to_pop:
-						# if batch qty > 0
-						# not enough or exactly same qty in current batch, clear batch
-						qty_to_pop -= flt(batch[0])
-						transferred_item_details[transferred_item_key].append(fifo_queue.pop(0))
-					else:
-						# all from current batch
-						batch[0] = flt(batch[0]) - qty_to_pop
-						transferred_item_details[transferred_item_key].append([qty_to_pop, batch[1]])
-						qty_to_pop = 0
-
-		item_details[key]["qty_after_transaction"] = d.qty_after_transaction
-
-		if "total_qty" not in item_details[key]:
-			item_details[key]["total_qty"] = d.actual_qty
-		else:
-			item_details[key]["total_qty"] += d.actual_qty
-
-		item_details[key]["has_serial_no"] = d.has_serial_no
-
-	return item_details
-
-def get_stock_ledger_entries(filters):
-	return frappe.db.sql("""select
-			item.name, item.item_name, item_group, brand, description, item.stock_uom, item.has_serial_no,
-			actual_qty, posting_date, voucher_type, voucher_no, serial_no, batch_no, qty_after_transaction, warehouse
-		from `tabStock Ledger Entry` sle,
-			(select name, item_name, description, stock_uom, brand, item_group, has_serial_no
-				from `tabItem` {item_conditions}) item
-		where item_code = item.name and
-			company = %(company)s and
-			posting_date <= %(to_date)s and
-			is_cancelled != 1
-			{sle_conditions}
-			order by posting_date, posting_time, sle.creation, actual_qty""" #nosec
-		.format(item_conditions=get_item_conditions(filters),
-			sle_conditions=get_sle_conditions(filters)), filters, as_dict=True)
-
-def get_item_conditions(filters):
-	conditions = []
-	if filters.get("item_code"):
-		conditions.append("item_code=%(item_code)s")
-	if filters.get("brand"):
-		conditions.append("brand=%(brand)s")
-
-	return "where {}".format(" and ".join(conditions)) if conditions else ""
-
-def get_sle_conditions(filters):
-	conditions = []
-	if filters.get("warehouse"):
-		lft, rgt = frappe.db.get_value('Warehouse', filters.get("warehouse"), ['lft', 'rgt'])
-		conditions.append("""warehouse in (select wh.name from `tabWarehouse` wh
-			where wh.lft >= {0} and rgt <= {1})""".format(lft, rgt))
-
-	return "and {}".format(" and ".join(conditions)) if conditions else ""
-
-def get_chart_data(data, filters):
+def get_chart_data(data: List, filters: Filters) -> Dict:
 	if not data:
 		return []
 
@@ -294,17 +205,201 @@
 		"type" : "bar"
 	}
 
-def setup_ageing_columns(filters, range_columns):
-	for i, label in enumerate(["0-{range1}".format(range1=filters["range1"]),
-		"{range1}-{range2}".format(range1=cint(filters["range1"])+ 1, range2=filters["range2"]),
-		"{range2}-{range3}".format(range2=cint(filters["range2"])+ 1, range3=filters["range3"]),
-		"{range3}-{above}".format(range3=cint(filters["range3"])+ 1, above=_("Above"))]):
-			add_column(range_columns, label="Age ("+ label +")", fieldname='range' + str(i+1))
+def setup_ageing_columns(filters: Filters, range_columns: List):
+	ranges = [
+		f"0 - {filters['range1']}",
+		f"{cint(filters['range1']) + 1} - {cint(filters['range2'])}",
+		f"{cint(filters['range2']) + 1} - {cint(filters['range3'])}",
+		f"{cint(filters['range3']) + 1} - {_('Above')}"
+	]
+	for i, label in enumerate(ranges):
+		fieldname = 'range' + str(i+1)
+		add_column(range_columns, label=f"Age ({label})",fieldname=fieldname)
 
-def add_column(range_columns, label, fieldname, fieldtype='Float', width=140):
+def add_column(range_columns: List, label:str, fieldname: str, fieldtype: str = 'Float', width: int = 140):
 	range_columns.append(dict(
 		label=label,
 		fieldname=fieldname,
 		fieldtype=fieldtype,
 		width=width
 	))
+
+
+class FIFOSlots:
+	"Returns FIFO computed slots of inwarded stock as per date."
+
+	def __init__(self, filters: Dict = None , sle: List = None):
+		self.item_details = {}
+		self.transferred_item_details = {}
+		self.serial_no_batch_purchase_details = {}
+		self.filters = filters
+		self.sle = sle
+
+	def generate(self) -> Dict:
+		"""
+			Returns dict of the foll.g structure:
+			Key = Item A / (Item A, Warehouse A)
+			Key: {
+				'details' -> Dict: ** item details **,
+				'fifo_queue' -> List: ** list of lists containing entries/slots for existing stock,
+					consumed/updated and maintained via FIFO. **
+			}
+		"""
+		if self.sle is None:
+			self.sle = self.__get_stock_ledger_entries()
+
+		for d in self.sle:
+			key, fifo_queue, transferred_item_key = self.__init_key_stores(d)
+
+			if d.voucher_type == "Stock Reconciliation":
+				prev_balance_qty = self.item_details[key].get("qty_after_transaction", 0)
+				d.actual_qty = flt(d.qty_after_transaction) - flt(prev_balance_qty)
+
+			serial_nos = get_serial_nos(d.serial_no) if d.serial_no else []
+
+			if d.actual_qty > 0:
+				self.__compute_incoming_stock(d, fifo_queue, transferred_item_key, serial_nos)
+			else:
+				self.__compute_outgoing_stock(d, fifo_queue, transferred_item_key, serial_nos)
+
+			self.__update_balances(d, key)
+
+		return self.item_details
+
+	def __init_key_stores(self, row: Dict) -> Tuple:
+		"Initialise keys and FIFO Queue."
+
+		key = (row.name, row.warehouse) if self.filters.get('show_warehouse_wise_stock') else row.name
+		self.item_details.setdefault(key, {"details": row, "fifo_queue": []})
+		fifo_queue = self.item_details[key]["fifo_queue"]
+
+		transferred_item_key = (row.voucher_no, row.name, row.warehouse)
+		self.transferred_item_details.setdefault(transferred_item_key, [])
+
+		return key, fifo_queue, transferred_item_key
+
+	def __compute_incoming_stock(self, row: Dict, fifo_queue: List, transfer_key: Tuple, serial_nos: List):
+		"Update FIFO Queue on inward stock."
+
+		if self.transferred_item_details.get(transfer_key):
+			# inward/outward from same voucher, item & warehouse
+			slot = self.transferred_item_details[transfer_key].pop(0)
+			fifo_queue.append(slot)
+		else:
+			if not serial_nos:
+				if fifo_queue and flt(fifo_queue[0][0]) < 0:
+					# neutralize negative stock by adding positive stock
+					fifo_queue[0][0] += flt(row.actual_qty)
+					fifo_queue[0][1] = row.posting_date
+				else:
+					fifo_queue.append([row.actual_qty, row.posting_date])
+				return
+
+			for serial_no in serial_nos:
+				if self.serial_no_batch_purchase_details.get(serial_no):
+					fifo_queue.append([serial_no, self.serial_no_batch_purchase_details.get(serial_no)])
+				else:
+					self.serial_no_batch_purchase_details.setdefault(serial_no, row.posting_date)
+					fifo_queue.append([serial_no, row.posting_date])
+
+	def __compute_outgoing_stock(self, row: Dict, fifo_queue: List, transfer_key: Tuple, serial_nos: List):
+		"Update FIFO Queue on outward stock."
+		if serial_nos:
+			fifo_queue[:] = [serial_no for serial_no in fifo_queue if serial_no[0] not in serial_nos]
+			return
+
+		qty_to_pop = abs(row.actual_qty)
+		while qty_to_pop:
+			slot = fifo_queue[0] if fifo_queue else [0, None]
+			if 0 < flt(slot[0]) <= qty_to_pop:
+				# qty to pop >= slot qty
+				# if +ve and not enough or exactly same balance in current slot, consume whole slot
+				qty_to_pop -= flt(slot[0])
+				self.transferred_item_details[transfer_key].append(fifo_queue.pop(0))
+			elif not fifo_queue:
+				# negative stock, no balance but qty yet to consume
+				fifo_queue.append([-(qty_to_pop), row.posting_date])
+				self.transferred_item_details[transfer_key].append([row.actual_qty, row.posting_date])
+				qty_to_pop = 0
+			else:
+				# qty to pop < slot qty, ample balance
+				# consume actual_qty from first slot
+				slot[0] = flt(slot[0]) - qty_to_pop
+				self.transferred_item_details[transfer_key].append([qty_to_pop, slot[1]])
+				qty_to_pop = 0
+
+	def __update_balances(self, row: Dict, key: Union[Tuple, str]):
+		self.item_details[key]["qty_after_transaction"] = row.qty_after_transaction
+
+		if "total_qty" not in self.item_details[key]:
+			self.item_details[key]["total_qty"] = row.actual_qty
+		else:
+			self.item_details[key]["total_qty"] += row.actual_qty
+
+		self.item_details[key]["has_serial_no"] = row.has_serial_no
+
+	def __get_stock_ledger_entries(self) -> List[Dict]:
+		sle = frappe.qb.DocType("Stock Ledger Entry")
+		item = self.__get_item_query() # used as derived table in sle query
+
+		sle_query = (
+			frappe.qb.from_(sle).from_(item)
+			.select(
+				item.name, item.item_name, item.item_group,
+				item.brand, item.description,
+				item.stock_uom, item.has_serial_no,
+				sle.actual_qty, sle.posting_date,
+				sle.voucher_type, sle.voucher_no,
+				sle.serial_no, sle.batch_no,
+				sle.qty_after_transaction, sle.warehouse
+			).where(
+				(sle.item_code == item.name)
+				& (sle.company == self.filters.get("company"))
+				& (sle.posting_date <= self.filters.get("to_date"))
+				& (sle.is_cancelled != 1)
+			)
+		)
+
+		if self.filters.get("warehouse"):
+			sle_query = self.__get_warehouse_conditions(sle, sle_query)
+
+		sle_query = sle_query.orderby(
+			sle.posting_date, sle.posting_time, sle.creation, sle.actual_qty
+		)
+
+		return sle_query.run(as_dict=True)
+
+	def __get_item_query(self) -> str:
+		item_table = frappe.qb.DocType("Item")
+
+		item = frappe.qb.from_("Item").select(
+			"name", "item_name", "description", "stock_uom",
+			"brand", "item_group", "has_serial_no"
+		)
+
+		if self.filters.get("item_code"):
+			item = item.where(item_table.item_code == self.filters.get("item_code"))
+
+		if self.filters.get("brand"):
+			item = item.where(item_table.brand == self.filters.get("brand"))
+
+		return item
+
+	def __get_warehouse_conditions(self, sle, sle_query) -> str:
+		warehouse = frappe.qb.DocType("Warehouse")
+		lft, rgt = frappe.db.get_value(
+			"Warehouse",
+			self.filters.get("warehouse"),
+			['lft', 'rgt']
+		)
+
+		warehouse_results = (
+			frappe.qb.from_(warehouse)
+				.select("name").where(
+					(warehouse.lft >= lft)
+					& (warehouse.rgt <= rgt)
+				).run()
+		)
+		warehouse_results = [x[0] for x in warehouse_results]
+
+		return sle_query.where(sle.warehouse.isin(warehouse_results))
diff --git a/erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md b/erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md
new file mode 100644
index 0000000..5ffe97f
--- /dev/null
+++ b/erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md
@@ -0,0 +1,73 @@
+### Concept of FIFO Slots
+
+Since we need to know age-wise remaining stock, we maintain all the inward entries as slots. So each time stock comes in, a slot is added for the same.
+
+Eg. For Item A:
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | +20 | [[50, 1-12-2021], [20, 2-12-2021]]
+----------------------
+
+Now the queue can tell us the total stock and also how old the stock is.
+Here, the balance qty is 70.
+50 qty is (today-the 1st) days old
+20 qty is (today-the 2nd) days old
+
+### Calculation of FIFO Slots
+
+#### Case 1: Outward from sufficient balance qty
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | -20 | [[30, 1-12-2021]]
+2nd  | +20 | [[30, 1-12-2021], [20, 2-12-2021]]
+
+Here after the first entry, while issuing 20 qty:
+- **since 20 is lesser than the balance**, **qty_to_pop (20)** is simply consumed from first slot (FIFO consumption)
+- Any inward entry after as usual will get its own slot added to the queue
+
+#### Case 2: Outward from sufficient cumulative (slots) balance qty
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | +20 | [[50, 1-12-2021], [20, 2-12-2021]]
+2nd  | -60 | [[10, 2-12-2021]]
+
+- Consumption happens slot wise. First slot 1 is consumed
+- Since **qty_to_pop (60) is greater than slot 1 qty (50)**, the entire slot is consumed and popped
+- Now the queue is [[20, 2-12-2021]], and **qty_to_pop=10** (remaining qty to pop)
+- It then goes ahead to the next slot and consumes 10 from it
+- Now the queue is [[10, 2-12-2021]]
+
+#### Case 3: Outward from insufficient balance qty
+> This case is possible only if **Allow Negative Stock** was enabled at some point/is enabled.
+
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | -60 | [[-10, 1-12-2021]]
+
+- Since **qty_to_pop (60)** is more than the balance in slot 1, the entire slot is consumed and popped
+- Now the queue is **empty**, and **qty_to_pop=10** (remaining qty to pop)
+- Since we still have more to consume, we append the balance since 60 is issued from 50 i.e. -10.
+- We register this negative value, since the stock issue has caused the balance to become negative
+
+Now when stock is inwarded:
+- Instead of adding a slot we check if there are any negative balances.
+- If yes, we keep adding positive stock to it until we make the balance positive.
+- Once the balance is positive, the next inward entry will add a new slot in the queue
+
+Eg:
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | -60 | [[-10, 1-12-2021]]
+3rd  | +5  | [[-5, 3-12-2021]]
+4th  | +10 | [[5, 4-12-2021]]
+4th  | +20 | [[5, 4-12-2021], [20, 4-12-2021]]
\ No newline at end of file
diff --git a/erpnext/stock/report/stock_balance/stock_balance.py b/erpnext/stock/report/stock_balance/stock_balance.py
index 3c7b26b..b4f43a7 100644
--- a/erpnext/stock/report/stock_balance/stock_balance.py
+++ b/erpnext/stock/report/stock_balance/stock_balance.py
@@ -9,7 +9,7 @@
 from frappe.utils import cint, date_diff, flt, getdate
 
 import erpnext
-from erpnext.stock.report.stock_ageing.stock_ageing import get_average_age, get_fifo_queue
+from erpnext.stock.report.stock_ageing.stock_ageing import FIFOSlots, get_average_age
 from erpnext.stock.report.stock_ledger.stock_ledger import get_item_group_condition
 from erpnext.stock.utils import add_additional_uom_columns, is_reposting_item_valuation_in_progress
 
@@ -33,7 +33,7 @@
 
 	if filters.get('show_stock_ageing_data'):
 		filters['show_warehouse_wise_stock'] = True
-		item_wise_fifo_queue = get_fifo_queue(filters, sle)
+		item_wise_fifo_queue = FIFOSlots(filters, sle).generate()
 
 	# if no stock ledger entry found return
 	if not sle:
diff --git a/erpnext/stock/report/warehouse_wise_item_balance_age_and_value/warehouse_wise_item_balance_age_and_value.py b/erpnext/stock/report/warehouse_wise_item_balance_age_and_value/warehouse_wise_item_balance_age_and_value.py
index 4d1491b..22bdb89 100644
--- a/erpnext/stock/report/warehouse_wise_item_balance_age_and_value/warehouse_wise_item_balance_age_and_value.py
+++ b/erpnext/stock/report/warehouse_wise_item_balance_age_and_value/warehouse_wise_item_balance_age_and_value.py
@@ -9,7 +9,7 @@
 from frappe import _
 from frappe.utils import flt
 
-from erpnext.stock.report.stock_ageing.stock_ageing import get_average_age, get_fifo_queue
+from erpnext.stock.report.stock_ageing.stock_ageing import FIFOSlots, get_average_age
 from erpnext.stock.report.stock_balance.stock_balance import (
 	get_item_details,
 	get_item_warehouse_map,
@@ -33,7 +33,7 @@
 	item_map = get_item_details(items, sle, filters)
 	iwb_map = get_item_warehouse_map(filters, sle)
 	warehouse_list = get_warehouse_list(filters)
-	item_ageing = get_fifo_queue(filters)
+	item_ageing = FIFOSlots(filters).generate()
 	data = []
 	item_balance = {}
 	item_value = {}