In the FIFO retail method, what does the ending inventory for any period represent?
A) The ending inventory at approximately the current cost.
B) The ending inventory at the beginning of the year cost dollars.
C) The ending inventory at the average cost dollars.
D) The sum of inventory layers from previous periods.
E) The sum of inventory layers each costed at current dollars found by applying the current years' selling prices.

Question

Quizplus · Accepted Answer

The ending inventory for any period in the FIFO method represents the inventory at approximately the current cost, as it assumes that the items purchased first were sold first, and therefore the items remaining in inventory are the most recently purchased at the current cost.

In the FIFO Retail Method, What Does the Ending Inventory