{"id":11877,"date":"2021-12-02T16:02:28","date_gmt":"2021-12-02T10:32:28","guid":{"rendered":"https:\/\/scholarsclasses.com\/blog\/?p=11877"},"modified":"2024-12-24T20:44:40","modified_gmt":"2024-12-24T15:14:40","slug":"lifo-meaning","status":"publish","type":"post","link":"https:\/\/scholarsclasses.com\/blog\/lifo-meaning\/","title":{"rendered":"LIFO Meaning (Last In, First Out) | Free Cost Accounting Articles"},"content":{"rendered":"\n

LIFO Meaning (Last In, First Out)<\/mark><\/h2>\n\n\n\n
\"LIFO
LIFO Meaning (Last In, First Out)<\/strong><\/figcaption><\/figure>\n\n\n\n

What is the Full form of LIFO?<\/strong><\/p>\n\n\n\n

The full form of LIFO<\/a> is Last In, First Out.<\/p>\n\n\n\n

This method is exactly opposite of the FIFO method. It is based on the assumption that the material purchased and received the last in-store is issued first to the job. Under this method, the cost of the last lot of materials purchased is used for pricing the material issues. Thereafter the price of the next earlier lot is taken and so on. In other words, the materials are issued at the latest cost price. The closing stock of materials are valued at the oldest cost price<\/p>\n\n\n\n

Under LIFO procedures, the objective is to charge the cost of current purchases to work in process or other operating expenses and to leave the oldest costs in the inventory. Several alternatives can be used to apply the LIFO method. Each procedure results in different costs for materials issued and the ending inventory, and consequently in a different profit. It is mandatory, therefore, to follow the chosen procedure consistently<\/p>\n\n\n\n

In case of a rising price, the LIFO method is suitable because the material is issued at the current price.<\/p>\n\n\n\n