Accounting Tools

MAY 12, 2024

FIFO is an acronym for first in, first out. The FIFO concept is best shown with the following example. Characteristics of FIFO A company that uses FIFO will find that the costs it maintains in its records for its inventory will always be the most current costs , since the last items purchased are still assumed to be in stock.

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Accounting Tools

MARCH 28, 2024

What is a LIFO Liquidation? A LIFO liquidation occurs when an organization using the last in, first out concept to track its inventory costs uses up its oldest inventory layer. Under the LIFO method, the cost of the last inventory acquired is assigned to the first inventory used.

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Accounting Tools

MAY 13, 2024

Related AccountingTools Courses Accounting for Inventory How to Audit Inventory Why Inventory Valuation is Important Inventory valuation is important for the reasons noted below. The LIFO method is commonly used in periods of rising prices to reduce income taxes paid.

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Accounting Tools

SEPTEMBER 8, 2023

Related Courses Accounting for Inventory How to Audit Inventory What is a LIFO Reserve? The LIFO reserve is the difference between the cost of inventory calculated using the FIFO method and using the LIFO method. Instead, a business could disclose the “excess of FIFO over LIFO cost”.

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Accounting Tools

AUGUST 1, 2023

Related Courses Accounting for Inventory How to Audit Inventory Inventory Management What is Perpetual FIFO? Perpetual FIFO is a cost flow tracking system under which the first unit of inventory acquired is presumed to be the first unit consumed or sold.

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Accounting Tools

JANUARY 30, 2024

The acronym (FISH) is a take-off on the FIFO and LIFO acronyms that describe inventory cost layering systems. Related AccountingTools Courses Accounting for Inventory How to Audit Inventory Related Articles Accounting Inventory Methods FIFO vs. LIFO Accounting How to Report an Inventory Write-Down Obsolete Inventory Accounting

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Accounting Tools

AUGUST 30, 2023

Related Courses Accounting for Inventory How to Audit Inventory What is the Double Extension Method? This index is used in the calculation of dollar value LIFO. Related Articles Accounting Inventory Methods FIFO vs. LIFO Accounting Perpetual LIFO vs. Periodic LIFO

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