An advantage of FIFO method of stock valuation is that

Assessment: JAMB UTME - Principles of Accounts - 2017 Subject: Financial Accounting

Question 1 Report

An advantage of FIFO method of stock valuation is that
Answer Details
The first in first out(FIFO) method of stock valuation, major advantage 1 it is very easy to apply 2 no manipulation of income is possible 3 the balance sheet amount for inventory is likely to approximate the current market value

its flow of cost is in sequence with the flow of stock: since the first stock will be considered for sale before other stock. the cost is always in sequence with the flow of stock because it correspondence with the normal physical flow of goods

Read lesson note on Stock Valuation (JAMB)
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