The First-In, First-out accounting method is an inventory valuation method. As the name suggests, it assumes that the value of the sold item is the value of the first item that
LIFO 后进先出 剩下的就是先买进的 所以balance sheet for stock的余额比较大 FIFO 先进先出 剩下的是后买进的 所以余额比较小。所以选B啊 FIFO method results in the lowest balance sheet figure in stock~
Why would it be advantageous for Target corporation to use LIFO instead of another inventory method? (a) Under what conditions is a LIFO layer created? (b) What is meant by "LIFO reserve"? Explain the difference between the accrual basis of accounting and the cash basis of accounting. Expla...
The First In, First Out FIFO method is a standard accounting practice that assumes that assets are sold in the same order they're bought. All companies are required to use the FIFO method to account for inventory in some jurisdictions but FIFO is a popular standard due to its ease and tra...
Application in Accounting and Stock Control: Businesses using FIFO calculate the cost of goods sold (COGS) based on the cost of the oldest inventory items. This method often aligns closely with the actual physical flow of goods, making it intuitive for stock control. ...
Objectives and Advantages of FIFO Method: One objective of FIFO is to approximate the physical flow of goods. When the physical flow of goods is actually first-in, first-out, the FIFO method closely approximates specific identification. At the same time, it does not permit manipulation of inco...
method where the oldest products are moved first,LIFO, or Last In, First Out, assumes that the most recently purchased products are sold first. In a rising price environment, this has the opposite effect on net income, where it is reduced compared to the FIFO inventory accounting method. ...
Learn about this important accounting concept, which is used in real-world business scenarios and for financial planning.
Inventory Valuation using the FIFO method If a company chooses to use the FIFO method of inventory accounting, the cost of goods sold will be equal to the cost of the first 150 units produced (remember "first in, first out"?) out of all the 300 units available in the stock. The first...
The First-In First-Out (FIFO) method of inventory valuation accounting is based on the practice of having the sale or usage of goods follow