Скачать или смотреть Inventory Valuation Methods – Finding the Right Method

For manufacturing companies, few things are as important in finance departments than inventory costing. Here’s an overview of different inventory valuation methods.

For manufacturing companies, few things are as important in finance departments than inventory costing. The valuation given to a company’s inventory will have a direct impact on gross profit, taxation and on its income. It also defines a company’s taxation and it informs stakeholders such as stockholders, owners, and partners of the true value of the cost of goods sold is at a given time period.

Cost of goods sold (COGS) has an inverse relationship upon gross profit. If a company’s COGS increases, gross profit decreases. On the other hand, if COGS decreases, gross profit will show a corresponding increase at the end of the measurable time period.

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Timecode:
0:00 Introduction
1:09 A Simple Process with Complex Meanings
2:10 Different Inventory Costing Methods
3:03 First In, First Out (FIFO)
4:51 Last In, First Out (LIFO)
5:40 Weighted Average Cost (WAC)
7:37 First Expired, First Out (FEFO)
8:29 Location Matters
9:26 Choosing the Right Method

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