These techniques affect the calculation of the cost of goods sold and, consequently, a company’s overall financial health. Understanding these differences is essential for accurate financial reporting and strategic decision-making. The last-in, last-out (LIFO) inventory costing method records the most recently purchased inventory or produced items (i.e., last in) as sold first. The cost of [Continue]

There are different circumstances and business climates that might necessitate selecting one inventory costing method over another. You might also select a method based on its effect on the company’s balance sheet. Weighted average cost inventory costing (WAC) is a method that uses average unit cost to calculate COGS and ending inventory. Understanding these costs [Continue]