FIFO assumes that inventory costs flow in the order incurred.

Name: FIFO assumes that inventory costs flow in the order incurred.
Brand: Quizplus
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Quizplus · Accepted Answer

FIFO stands for "first-in, first-out" and assumes that the oldest inventory items are sold first, meaning that the costs associated with those items are recognized first as cost of goods sold. This assumes that inventory costs flow in the order incurred, which is in line with the FIFO method.

FIFO Assumes That Inventory Costs Flow in the Order Incurred