Asked by Paola Zaragoza on Jun 17, 2024
Verified
Cost flow is in the order in which the costs were incurred.
A)Weighted average
B)First-in, first-out (FIFO)c.Last-in, first-out (LIFO)d.Specific identification
Cost Flow Assumptions
Refers to the methods used to determine the cost of inventory sold and remaining inventory value, including FIFO, LIFO, and weighted average.
FIFO
An inventory valuation method where goods first received are the first ones sold, used in accounting to determine cost of goods sold.
LIFO
LIFO, standing for Last-In, First-Out, is an accounting method used for inventory valuation where the most recently produced or acquired items are the first to be expensed.
- Understand the various cost flow assumptions and their applications in inventory valuation.
Verified Answer
KW
Learning Objectives
- Understand the various cost flow assumptions and their applications in inventory valuation.