The inventory method that assumes the cost of the ending inventory consists of new inventory is:

Question

Quizplus · Accepted Answer

FIFO (first in, first out) assumes that the first items purchased or produced are the first ones sold or used, resulting in the cost of the remaining items in inventory being equal to the most recent purchase or production costs. Therefore, the cost of the ending inventory is assumed to consist of new inventory.

The Inventory Method That Assumes the Cost of the Ending