Financial Accounting – Inventory Costs

Inventory cost flow assumptions – First In First Out (FIFO), Last In Firs Out (LIFO), Weighted Average Methods

Language: english

Note: 4.6/5 (216 notes) 31,140 students

Instructor(s): Robert (Bob) Steele

Last update: 2019-06-06

What you’ll learn

• Inventory Costing
• First In First Out (FIFO) cost flow method
• Last In First Out (LIFO) cost flow method
• Weighted average cost flow method
• Periodic inventory method
• Perpetual inventory method

Requirements

• We should have a basic understanding of financial accounting and debits and credits.

Description

We cover inventory costs and cost flows, including what is included in the cost of inventory and how to account for inventory freight costs, inventory insurance costs, and discount. We also discuss inventory flow assumptions including specific identification, first in first out (FIFO), last in first out (LIFO), and weighted average methods. FIFO, LIFO and weighted average methods will be discussed using both a periodic inventory system and a perpetual inventory system.

•    Excel Practice Files

•    Multiple Choice Practice Questions

•    Short Calculation Practice Questions

•    Discussion Questions

The PDF files allow us to download reference information we can use offline and as a guide to help us work through the material.

Excel practice files will be preformatted so that we can focus on the adjusting process and learning some of the basics of Excel, like addition, subtraction, and cell relationships.

Multiple choice example question helps us improve our test-taking skills by reducing the information into the size and format of multiple choice questions and discussing how to approach these questions.

Short calculation questions help us reduce problems that have some calculation down to a short format that could be used in multiple choice questions.

Discussion Question will provide an opportunity to discuss these topics with the instructor and other students, a process many students find very helpful because it allows us to see the topic from different viewpoints.

Who will we be learning from?

You will be learning from somebody who has technical experience in accounting concepts and in accounting software like QuickBooks, as well as experience teaching and putting together curriculum.

You will be learning from somebody who is a:

•    CPA – Certified Public Accountant

•    CGMA – Chartered Global Management Accountant

•    Master of Science in Taxation

•    CPS – Certifies Post-Secondary Instructor

•    Curriculum Development Export

As a practicing CPA the instructor has worked with many technical accounting issues and helped work through them and discuss them with clients of all levels.

As a CPS and professor, the instructor has taught many accounting classes and worked with many students in the fields of accounting, business, and business applications.

The instructor also has a lot of experience designing courses and learning how students learn best and how to help students achieve their objectives. Experience designing technical courses has also benefit in being able to design a course in a logical fashion and deal with problems related to technical topics and the use of software like QuickBooks Pro.

Summary of what will be covered:

• Inventory Tracking methods
• Specific identification method
• First in first out (FIFO) method
• Last in first out (LIFO) method
• Weighted average method
• Inventory costs
• Fright
• Insurance
• Purchase discounts
• Periodic system verses a perpetual system.
• We discuss FIFO, LIFO, and weighted average under each system.
• Key definitions
• Comprehensive problem

Who this course is for

• Accounting students
• Anyone who whats to learn accounting

Course content

• Introduction
• Introduction
• Inventory Tracking & Inventory Methods
• Inventory Tracking & Inventory Methods
• PDF – 10 600 Inventory Tracking Explained – Introduction-Specific Ide
• 10 600 Inventory Tracking Explained – Introduction-Specific Ide
• PDF – 15 600 Inventory Methods Explained and compared FIFO LIFO Ave
• 15 600 Inventory Methods Explained and compared FIFO LIFO Ave
• Inventory Cost, Principles, and Perpetual vs Periodic Inventory Systems
• Inventory Cost, Principles, and Perpetual vs Periodic Methods
• PDF – 17 Inventory Costs
• 17 Inventory Costs
• PDF – 20 Consistency Concept
• 20 Consistency Concept
• PDF – 30 Lower of Cost or Market
• 30 Lower of Cost or Market
• PDF – 40 Perpetual & Periodic Inventory Systems
• 40 Perpetual & Periodic Inventory Systems
• Discussion Question 1 Inventory Cost
• Periodic System First In First Out (FIFO)
• Periodic System First In First Out (FIFO)
• PDF – 42 First In First Out (FIFO) Periodic System
• 42 First In First Out (FIFO) Periodic System
• Worksheet FIFO Periodic System
• Discussion Question 2 – Inventory Cost
• Accounting Comic Break
• Periodic System Last In Last Out (LIFO)
• Periodic System Last In First Out (LIFO)
• PDF – 44 Last In First Out LIFO Periodic
• 44 Last In First Out LIFO Periodic
• Worksheet Last In First Out (LIFO) Periodic System
• Discussion Question 3 Inventory Cost
• Multiple Choice 1 – Inventory Cost
• Periodic Weighted Average Method
• Periodic Weighted Average Method
• PDF – 46 Weighted Average Periodic System
• 46 Weighted Average Periodic System
• Worksheet Weighted Average Periodic System
• Discussion Question 4 Inventory Cost
• Multiple Choice 2 – Inventory Cost
• Perpetual System Fist In First Out (FIFO)
• Perpetual System First In First Out (FIFO)
• PDF 50 600 First In First Out FIFO Explained
• 50 600 First In First Out FIFO Explained
• 600.10 Inventory Cost Problem First In First Out part 1 Ex.%2C how to calculate
• 600.20 Inventory Cost Problem First In First Out part 2 Ex.%2C how to calculate-
• Discussion Question 5 Inventory Cost
• Multiple Choice 3 – Inventory Cost
• Perpetual System Last In First Out (LIFO)
• Perpetual System Last In First Out LIFO
• PDF – 60 600 Last In First Out LIFO Inventory Method Explained
• 60 600 Last In First Out LIFO Inventory Method Explained
• 600.50 Cost Problem Last In First Out LIFO part 1 Ex.%2C how to calculate-Accoun
• 600.60 Cost Problem Last In First Out LIFO part 2 Ex.%2C how to calculate-Accoun
• Discussion Question 6 Inventory Cost
• Multiple Choice 4 – Inventory Cost
• Short Calculation Test Questions 1
• Perpetual System Weighted Average Method
• Perpetual System Weighted Average Method
• PDF – 70 600 Average Inventory Method Explained
• 70 600 Average Inventory Method Explained
• 600.30 Inventory Cost Problem Average method Part 1 Ex.%2C how to calculate-Acco
• 600.40 Inventory Cost Problem Average method Part 2 Ex.%2C how to calculate
• Discussion Question 7 Inventory Cost
• Multiple Choice 5 Inventory Cost
• Short Calculation 2
• Definitions & Key Terms
• Definitions & Key Terms
• Average Cost Definition – What is Average Cost%3F
• Conservatism Constraint Definition – What is Conservatism Co
• Consignee Definition – What is Consignee%3F
• Consignor Definition – What is a Consignor%3F
• Consistency Concept Definition – What is Consistency Concept
• Days Sales in Inventory Definition – What is days sales in i
• First in First out Definition FIFO – What is First in First
• Gross Profit Definition – What is Gross Profit%3F (1)
• Interim Financial Statements Definition – What are Interim Financial Statements%
• Inventory Turnover Definition – What is Inventory Turnover%3F
• Last in First Out LIFO Definition – What is Last in First ou
• Lower of Cost or Market Definition – What is Lower of Cost o
• Net Realizable Value Definition – What is Net Realizable Val
• Retail Inventory Method Definition – What is Retail Inventory Method%3F
• Specific Identification Definition – What is Specific Identi
• Weighted Average Definition – What is Weighted Average Metho
• Multiple Choice 6 Inventory Cost
• Comprehensive Problem
• Comprehensive Problem
• 1 Accounting%2C Financial – Comp Problem Merchandising Co Journal Entries Part 1
• 2 Accounting%2C Financial – Comp Problem Merchandising Co Journal Entries Part 2
• 3.5 Accounting%2C Financial – Comp Problem Merchandising Co Journal Entries Part
• 4 Accounting%2C Financial – Comp Problem Merchandising Co %282%29. Journal Entri
• 5 Accounting%2C Financial – Comp Problem Merchandising Co. Journal Entries Part
• 6 Comp Problem Merchandising Co. Adjusting Entries Part 6
• 7 Accounting%2C Financial – Comp Problem Merchandising Co. Adjusting Entries Par
• 8 Accounting%2C Financial – Comp Problem Merchandising Co. Financial Statements
• 9 Accounting%2C Financial – Comp Problem Merchandising Co. Financial Statements
• 10 Accounting%2C Financial – Comp Problem Merchandising Co. Financial Statements
• 11 Accounting%2C Financial – Comp Problem Merchandising Co. Financial Statements
• 12 Accounting%2C Financial – Comp Problem Merchandising Co. Closing Entries Part
• 13 Accounting%2C Financial – Comp Problem Merchandising Co. Closing Entries Part

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