Fifo-Lifo

LIFO-FIFO valuation of raw material and supphes inventory is an important consideration for management. LIFO means last in, first out, referring to the purchase of materials inventory. FIFO means first in, first out. The method selected is reflected not only in the operating expenses but also in the income statement and the balance sheet. At different times it may be more advantageous financially to use one instead of the other. 

The value of the inventory 7 at any given time depends on the values ascribed to the units withdrawn from inventoiy. There are five methods forvalmng inventoiy (I) FIFO (first-in-first-out), (2) LIFO (last-in-first-out), (3) average cost, (4) standard cost, and (5) market value. 

Let us calculate the value of the raw-materials inventory after, say, 5500 units have been withdrawn from inventory, first by using FIFO and then by using LIFO. 

Thus, in a time of rising raw-materials prices, the FIFO method gives a higher value for the remaining inventory than will LIFO. In a time of falling prices, the FIFO method will give a lower value for the remaining inventory than will LIFO. 

On the basis of Table 9-30, when 5500 items have been removed from inventory, the value of the inventoiy by using the FIFO, LIFO, simple-average, and weighted average methods respectively is... 

There are at least three different methods for valuing inventory (1) firsf-in-first-ouf (FIFO), (2) last-in-first-out (LIFO), and (3) weighted average cost (WAC). 

In the FIFO method, it is assumed that the 30 remaining bottles were purchased in April (10) and March (20). Therefore, the value of fhe inventory is 10 X 65 + 20 X 75 = 2150. The LIFO method assumes that the remaining... 

On Aug. 1, a concern had 10,000 lb of raw material on hand which was purchased at a cost of 0,030 per pound. In order to build up the reserve, 8000 lb of additional raw material was purchased on Aug. 15 at a cost of 0,028 per pound, and 2 days later 6000 lb was purchased from another suppher at 0.031 per pound. If none of the raw material was used until after the last purchase determine the total cost of 12,000 lb of the raw material on an inventory or cost-of-sales account for the month of August by (a) the current-average method, (b) the fifo method, and (c) the lifo method. 

Inflation has suddenly doubled the cost of all Cleansolv raw materials and tripled machinery costs. How is this likely to affect Delchem s evaluation of assets under raw materials, plants, and finished goods The price of Cleansolv has also doubled. What will happen to the profit margin Should the company use LIFO or FIFO accounting Is it dangerous and unrealistic to keep depreciation charges at the original machine cost once replacement machinery cost has tripled ... 

FIFO LIFO) first-in-first-out (last-in-first-out)... 

We can generalize the standard multiclass product-form network in several ways and still get the same simple steady-state distribution. Instead of the FIFO discipline, we can use any queueing discipline that depends only on the position of the jobs in the queue (and not, for example, on a job s class or service time) and the same steady-state distribution will apply. Under certain queue disciplines, nonexponential service distributions may be allowed, and the service distribution may be allowed to depend on class. These disdplines include SIRO, PS, and preemptive LIFO, which were discussed in the introduction to Section 4. The M/M/s queue under any of these disciptines becomes what is known as a symmetric queue (Kelly 1979), rmd this property underhes the possibility of relaxing the exponentiality assumption while maintaining the product-form steady-state distribution. 

The total cost of barrels sold by the lifo method is 750,000 less than that of the fifo method. The unit costs are 24.30/bbl for the fifo method and 22.18/bbl for the lifo method. 

At the end of 2001, the number of units in the inventory is 2,900. Use both the fifo and lifo methods to determine the cost of goods sold for 2001. 

As far as repair policies are considered, two of them will be investigated. According to the first poUcy, failed components are chosen for repair in the reverse order , i.e. the one with the largest index is selected first. If Gi = 0,1 < i < N, then for each linear subset of components (i.e. all components located between Co and a leaf node) this is the FIFO policy. Indeed, as only the components connected to eo can fail, ey located below ex (yielding x < y) can only fail if ex is operable, i.e. ey can only fail prior to ex. As x < y, ey is selected for repair before ex, i.e. the FIFO policy is in place. The second policy consists in prioritizing the components with smaller indexes, i.e. the one with the smallest index is first selected for repair. If Gi = 0, 1 < i < N, then for each linear subset of components this is the LIFO policy. Indeed, if ex is located above ex (yielding x < y) then ex can only fail after ey. As x < y, ex is selected for repair before ey, i.e. the LIFO policy is in place. 

The pickers were not usually able to track materials properly as they did not have sufficient access to important information such as lot number and expiration date. Also they could not ensure proper rotation of inventory, such as fi rst-in-first-out (FIFO) and last-in-first-out (LIFO). 

Finally, the use of isotopic composition measurements showed that the mechanism for exchange of freshly ingested uranium with the uranium stored in the body did not follow either the first in-first out (FIFO) model or the last in-first out (LIFO) model, but was a composite of the two (Karpas et al. 1998). 

Inventories Inventories are valued at the lower of cost or market. Cost is determined using the average first-in, first-out (FIFO) or last-in, first-out (LIFO) methods. ... 

Approximately 3%, in both 2013 and 2012, of the inventory cost was computed using the LIFO method. The differences between LIFO and FIFO methods of valuing these inventories were not material. 

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