Inventory

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Inventory


Lecture number:
19
Pages:
3
Type:
Lecture Note
School:
Miami University, Oxford
Course:
Acc 221 - Intro to Financial Accounting
Edition:
1
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Unformatted text preview:

Lecture 19 Outline of Previous Lecture  Section 18: Revenue and Inventory Accounts  Chapter 5 cont. – Revenue Accounts o Sales Discounts o Sales, returns, and allowance  Chapter 6 – Inventory Accounts o Inventory o Inventory in and out of accounts Outline of Current Lecture  Section 19: Inventory  Chapter 6 cont. – Inventory o Methods o Operations o LIFO Conformity Rule o Average Costs o Dollar Value of Inventory Account Current Lecture  Section 19: Inventory  Chapter 6 cont. - Inventory o Methods  First In First Out  Most companies use this method for the physical flow of their inventory  Frequently used with newer companies o Shows larger income statement o Attracts stockholders  Last In first Out  Used with established companies o Receive larger tax break o Operations  Always assume that there is inflation  Companies may pick either FIFO or LIFO for their values – cannot change every month  Anything removed from inventory is cost of goods sold  Entry to sell products  Dr. Cost of Goods Sold, Cr. Inventory o LIFO Conformity Rule ACC 221 1st Edition



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