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LIFO

What is LIFO?

There are two accounting techniques known as FIFO and LIFO that are used to manage inventory and financial concerns regarding the amount of money a corporation must have locked up in inventory of finished goods, raw materials, parts, components, or feedstocks.

Consider that Company A sells 10 widgets. The first five widgets, which cost $100 each, were delivered two days ago. Just yesterday did the last five $200 apiece widgets arrive. The LIFO method of inventory management states that the last products received are the first to be released onto the market.

First-in, first-out (FIFO) is calculated by multiplying the cost of your oldest inventory by the quantity of inventory sold, whereas last-in, first-out (LIFO) is calculated by multiplying the cost of your most recent inventory.

To learn more about LIFO refer to:

https://brainly.com/question/13510592

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The profitability ratios (roa, roe) appear to be higher under the LIFO inventory cost flow assumption.

What is LIFO?

  • To manage inventory and financial concerns regarding the amount of money a corporation must have locked up in inventory of finished goods, raw materials, parts, components, or feedstocks, two accounting techniques known as FIFO and LIFO are used.
  • Consider Company A, which sells ten widgets. The first five widgets, each costing $100, arrived two days ago.
  • The last five $200 widgets arrived just yesterday. According to the LIFO inventory management method, the most recent products received are the first to be released to the market.
  • First-in, first-out (FIFO) is calculated by multiplying the cost of your oldest inventory by the quantity of inventory sold, whereas LIFO is calculated by multiplying the cost of your most recent inventory by the quantity of inventory sold.

To learn more about LIFO refer to:

brainly.com/question/13510592

#SPJ4

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