Which of the following often parallels the actual physical flow of merchandise?

Question

Quizplus · Accepted Answer

FIFO (First-In, First-Out) method assumes that the first inventory purchased is the first inventory sold, which often parallels the actual physical flow of merchandise. This method is commonly used in industries where the goods have a short shelf life, such as perishable goods or fashion. Conversely, LIFO (Last-In, First-Out) assumes that the most recently purchased inventory is the first to be sold, which does not always match the actual flow of inventory. Dollar-value LIFO and Average-cost methods can be used for inventory costing but do not necessarily mirror the physical flow of merchandise.

Which of the Following Often Parallels the Actual Physical Flow