FIFO yields the same inventory valuation and cost of goods sold amounts under both the periodic and perpetual inventory systems.

Question

Quizplus · Accepted Answer

FIFO (First-In-First-Out) assumes that the first items received in inventory are the first items sold. Therefore, whether using a periodic or perpetual inventory system, the cost of goods sold will be calculated in the same way, resulting in the same valuation of inventory and cost of goods sold amounts.

FIFO Yields the Same Inventory Valuation and Cost of Goods