Last in first out: Inventory accounting system in which last purchases are the first to be used to determine ending inventory and the cost of goods sold
- Oldest costs tend to remain in the inventory account
- Results in lower net income in a period of rising prices when compared to the FIFO method
- Inventory value is understated in period of rising prices
- Acceptable method only under GAAP
Accounting Flashcards includes a translate button for English, Chinese, and Spanish.
Learn financial accounting using beautifully illustrated flashcards, coordinated lessons, and rich audio. Whether you are an aspiring CPA or IFRS expert, use this accountancy app to reach your goals. Even an aspiring chartered accountant or those reaching for the CPA Australia can benefit. Topics of accounting standards, equation, terms, ratios, and more are covered.
« Back to Glossary Index