Question

When merchandise sold is assumed to be in the order in which the purchases were made, the company is using a.last-in, first-out b.average cost c.first-in, last-out d.first-in, first-out

Answer 1

Answer:

The correct answer is letter "D": first-in, first-out.

Explanation:

A business using the first-in, first-out (FIFO) inventory valuation approach must sell, use or dispose first of all the products it produced or acquired. According to the FIFO process, the most recent assets purchased or generated are those that remain in inventory. Older stock is first removed from inventory.