Question

When merchandise sold is assumed to be in the order in which the purchases were made, the company is using.

Answer 1

The company is using the FIFO method. To ensure correct inventory records, one of the foremost common strategies is first in first out (first-in, first-out), which assumes the oldest inventory was sold  1st and therefore the worth is calculated consequently.

The first in first out methodology is employed for price flow assumption functions. In producing, as things achieve later development stages and as finished inventory things area unit sold, the associated prices therewith product should be recognized as an expense.

The batch process, first in first out in its strictest sense is tough to take care of in instruction execution. If you're moving or processing your elements in boxes or batches, then it'll be tough to take care of a first in first out among box.

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