Question

calculate the ending inventory and cost of goods sold dollar values for abc company, which uses using periodic inventory updating system, under the following two cost flow assumptions: (a) first-in, first-out (fifo) (b) last-in, first-out (lifo)

Answer 1

The cost of goods sold under FIFO is calculated by taking the cost per unit for the first 3,200 units purchased.

What is FIFO?

FIFO is an acronym for first in, first out, a method for organizing the manipulation of a data structure in which the oldest entry, or "head" of the queue, is processed first.

FIFO is based on the natural flow of inventory (oldest products are sold first, with accounting going by those costs first). This simplifies bookkeeping and reduces the possibility of errors. Reduced waste (a company truly following the FIFO method will always be moving out the oldest inventory first).

To calculate FIFO (First-In, First-Out), multiply the cost of your oldest inventory by the amount of inventory sold, whereas to calculate LIFO (Last-In, First-Out), multiply the cost of your most recent inventory by the amount of inventory sold.

To know more about FIFO follow the link:

brainly.com/question/24938626

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