How Do You Take Inventory Using The LIFO Method?
Keeping tracking of what goes in and out of a company can be hard work. The ramifications of faulty inventory valuations may be endless for a company. It is important to know how certain methods of tracking affect income and taxes. The LIFO method is a common process used for inventory. Find out how inventory is usually sold. This may seem like a very simple question, but it is crucial in understanding which inventory method to use. When inventory is stocked, how do items reached the sales floor? Are the most recent items stocked taken to the floor or are the oldest items taken to the floor? The correlation between costs and sales are more accurately reflected under the LIFO method when the most recent items reach the sales floor first. Make sure the LIFO method is reflected in financial and tax records. If LIFO is only used in tax records to receive a larger tax benefit while financial records reflect other inventory valuation, the integrity of the financial and tax records may be cha
