ACCOUNTING

View this short introduction to the discussion.

Click here to watch the video

Per the video summary, there are three (3) primary methods used by companies to assign costs to inventory and cost of goods sold: LIFO, FIFO, and Weighted Average. Each method assumes a particular pattern for how costs flow through inventory, but this is not a guarantee of how the inventory will actually flow. With each method comes a number of pros and cons that a company must consider when implementing its inventory management strategy. Select a company below to learn more about their chosen method. Then discuss the benefits of the chosen method taking into consideration how that particular method impacts the calculation of the inventory account, the cost of goods sold account, and the financial statements for that company.

Target – Uses LIFO

Amazon – Uses FIFO

FedEx – Uses Weighted Average

Target
Amazon
FedEx

Review Article

Review Article

Review Article

ACCOUNTING

View this short introduction to the discussion.

Click here to watch the video

Per the video summary, there are three (3) primary methods used by companies to assign costs to inventory and cost of goods sold: LIFO, FIFO, and Weighted Average. Each method assumes a particular pattern for how costs flow through inventory, but this is not a guarantee of how the inventory will actually flow. With each method comes a number of pros and cons that a company must consider when implementing its inventory management strategy. Select a company below to learn more about their chosen method. Then discuss the benefits of the chosen method taking into consideration how that particular method impacts the calculation of the inventory account, the cost of goods sold account, and the financial statements for that company.

Target – Uses LIFO

Amazon – Uses FIFO

FedEx – Uses Weighted Average

Target
Amazon
FedEx

Review Article

Review Article

Review Article

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