last-in first-out method of inventory costing

简明释义

存货的后进先出成本计算法

英英释义

例句

1.Many retailers prefer the last-in first-out method of inventory costing for perishable goods to ensure freshness.

许多零售商更喜欢对易腐商品使用后进先出法以确保新鲜度。

2.Using the last-in first-out method of inventory costing helped the business manage its older stock more effectively.

使用后进先出法帮助企业更有效地管理其旧库存。

3.The last-in first-out method of inventory costing can lead to higher profits on paper, but it doesn’t always reflect actual cash flow.

虽然后进先出法在账面上可能导致更高的利润，但它并不总是反映实际现金流。

4.By applying the last-in first-out method of inventory costing, the firm was able to reduce its taxable income during inflationary periods.

通过应用后进先出法，公司能够在通货膨胀期间减少应税收入。

5.The company decided to use the last-in first-out method of inventory costing to better match current costs with revenues.

公司决定使用后进先出法来更好地匹配当前成本与收入。

作文

The concept of inventory costing is crucial for businesses that deal with physical products. One of the most widely used methods in this regard is the last-in first-out method of inventory costing. This method, often abbreviated as LIFO, assumes that the most recently acquired inventory items are the first to be sold or used. Understanding this method is essential for accurate financial reporting and inventory management.To illustrate the last-in first-out method of inventory costing, consider a company that sells electronic gadgets. Suppose the company has the following inventory purchases:- 100 units at $10 each (first purchase)- 100 units at $12 each (second purchase)- 100 units at $15 each (third purchase)If the company sells 150 units, under the LIFO method, it would sell the 100 units from the third purchase first, followed by 50 units from the second purchase. Therefore, the cost of goods sold (COGS) would be calculated as follows:- 100 units at $15 = $1,500- 50 units at $12 = $600This results in a total COGS of $2,100. The remaining inventory would then consist of:- 100 units at $10 (first purchase)- 50 units at $12 (second purchase)This results in an ending inventory valued at:- 100 units at $10 = $1,000- 50 units at $12 = $600Thus, the ending inventory value would be $1,600. The last-in first-out method of inventory costing can have significant implications for a company's financial statements and tax liabilities. During periods of inflation, LIFO can lead to lower taxable income because the higher costs of the latest inventory are matched against revenues. Consequently, this can result in tax savings for the business. However, it may also lead to lower reported earnings on the income statement, as the COGS will be higher.Despite its advantages, the last-in first-out method of inventory costing is not without its drawbacks. For one, it can create a mismatch between the cost of inventory on the balance sheet and the actual market value of the inventory. This is particularly true if prices fluctuate significantly over time. Additionally, not all countries allow the use of LIFO for tax reporting purposes, which can complicate matters for multinational companies.In conclusion, the last-in first-out method of inventory costing is a valuable tool for businesses in managing their inventory and understanding their financial position. While it offers certain advantages, especially in times of rising prices, it is essential for companies to weigh these benefits against the potential downsides. Ultimately, the choice of inventory costing method should align with the company's overall financial strategy and operational needs. By comprehensively understanding the implications of LIFO, businesses can make informed decisions that support their long-term success.

库存成本的概念对处理实物产品的企业至关重要。在这方面，最广泛使用的方法之一是后进先出库存成本法。这种方法通常缩写为LIFO，假设最近购入的库存商品是最先被销售或使用的。理解这种方法对于准确的财务报告和库存管理至关重要。为了说明后进先出库存成本法，考虑一家销售电子小工具的公司。假设该公司有以下库存采购：- 100单位，每单位$10（第一次采购）- 100单位，每单位$12（第二次采购）- 100单位，每单位$15（第三次采购）如果该公司售出150单位，根据LIFO方法，它将首先售出第三次采购的100单位，然后再售出第二次采购的50单位。因此，销售成本（COGS）的计算如下：- 100单位，每单位$15 = $1,500- 50单位，每单位$12 = $600这导致总的COGS为$2,100。剩余的库存将是：- 100单位，每单位$10（第一次采购）- 50单位，每单位$12（第二次采购）因此，期末库存的价值为：- 100单位，每单位$10 = $1,000- 50单位，每单位$12 = $600因此，期末库存的价值为$1,600。后进先出库存成本法可能对公司的财务报表和税务负担产生重大影响。在通货膨胀期间，LIFO可以导致较低的应纳税收入，因为最新库存的较高成本与收入相匹配。因此，这可能为企业带来税收优惠。然而，这也可能导致在损益表上报告的收益较低，因为COGS将更高。尽管有其优势，后进先出库存成本法并非没有缺点。首先，它可能导致资产负债表上库存成本与实际市场价值之间的不匹配。这在价格大幅波动时尤其明显。此外，并非所有国家都允许在税务报告中使用LIFO，这可能使跨国公司面临复杂情况。总之，后进先出库存成本法是企业管理库存和理解财务状况的有价值工具。虽然在价格上涨时提供了某些优势，但企业必须权衡这些好处与潜在缺点。最终，库存成本法的选择应与公司的整体财务战略和运营需求相一致。通过全面理解LIFO的影响，企业可以做出支持其长期成功的明智决策。