BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Under which inventory cost flow assumption is the cost of the most recent purchases likely to remain in inventory? Right! Under FIFO the first or oldest costs come out of inventory first, leaving the most recent costs in inventory.

Detailed explanation-2: -Under FIFO, it is assumed that the cost of inventory purchased first will be recognized first. The dollar value of total inventory decreases in this process because inventory has been removed from the company’s ownership.

Detailed explanation-3: -LAST-IN, FIRST-OUT (LIFO). LIFOInventory cost flow assumption based on the most recent costs being transferred first from inventory to cost of goods sold so that the oldest costs remain in ending inventory. is the opposite of FIFO: the most recent costs are moved to expense as sales are made.

Detailed explanation-4: -The inventory cost flow assumption where the cost of the most recent purchase is matched first against sales revenues is. Register now or log in to answer. LIFO, this can be understood without any argument or discussion !

Detailed explanation-5: -In the U.S. the cost flow assumptions include FIFO, LIFO, and average. (If specific identification is used, there is no need to make an assumption.) FIFO, LIFO, average are assumptions because the flow of costs out of inventory does not have to match the way the items were physically removed from inventory.