Essays on Lifo

Costco Wholesale Corporation is a leading merchandise firm that engages in the sale of a vast range of products ranging from electronics, household ware, and machinery to office ware. Costco recorded a profit of $27 million to merchandise costs resulting from deflationary trends in both 2015 and 2013 (Stock Analysis, 2016). However, in 2014, net inflationary trends caused a benefit of $28 million recorded to merchandise costs (Stock Analysis, 2016). This amplified the cumulative LIFO (Last-in, first-out) valuation of merchandise as at the close of 2015 and 2014, the aggregate effect of the LIFO valuation of merchandise stood at $ ...

The supply chain management tends to integrate the customers’ logistic requirements, the distributor and the supplier of a particular business entity into a single cohesive system. It is basically a collection of the individual physical entities, for instance, the plants where goods are manufactured, the centers of distribution, retail outlets, the conveyances, personnel and information, all the entities are linked together through the consumption of goods and services. Most of the organizations including the Walmart stores value the supply chain management because it tends to decrease time and also the final costs incurred by the customers in the purchase ...

The ongoing internationalization process persuaded regulators and businesses worldwide to think of a common global accounting language for business affairs. This move led to the development of IFRS. International Financial Reporting Standards (IFRS), sometimes referred to as International Accounting Standards, is a globally recognized accounting framework for businesses worldwide. The major purpose of this accounting standard is to make company accounts understandable and comparable across international boundaries. Currently, over 110 countries are following the IFRS accounting system in order to address complexities relating to international business affairs. However, the United States has not adopted IFRS yet, and the country ...

Inventory is stated at the lower of the cost or the market value. The U.S. subsidiary uses the last-in, first-out (LIFO) principle while the value of the rest of the inventory is estimated using the first-in, first-out basis (FIFO). The total inventory under FIFO was found to be $ 8,844 million. The LIFO valuation was $7,866 which was ($978) lower. FIFO method assumes that the inventory units that were first to get to the stores are the ones that will be sold first. The implication is that the old stocks move fast. On the other hand, the LIFO ...

Product costing systems have been developed specifically for production processes. They are a management tool, which helps to determine the cost of producing every product. In recent years product costing practices have been improved, emphasizing quality, waste reduction, concentration on value-added activities and customer satisfaction. Product costing can provide valuable insights into performance through analysing products costs, productivity, material used, labour expenditures and special demands as well as help to decide which products to promote further and which should be redesigned or taken out of production.

LIFO (last in first out) costing method provides a means for evaluating stocks, assigning the ...