Discuss the different inventory accounting methods that are used (and allowable) in GAAP. How do they...

60.1K

Verified Solution

Question

Accounting

Discuss the different inventory accounting methods that are used(and allowable) in GAAP. How do they differ from one another? Whywould you choose one over another? Choose a sample company,identify which method they use, and explain why.

Answer & Explanation Solved by verified expert

3.5 Ratings (515 Votes)

The different inventory accounting methods that are used and allowable in GAAP FIFO LIFO and WAC Firstinfirstout FIFO inventory valuation According to the firstinfirstout FIFO inventory valuation method its assumed that inventory items are sold in the order in which theyre manufactured or purchased In other words the oldest inventory items are sold first The FIFO method is widely used because companies typically sell products in the order in which theyre purchased so it best represents the actual flow of goods in a business Lastinfirstout LIFO inventory valuation The See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member