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New Member
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Mar 14, 2008, 08:59 AM
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Lifo, fifo, and avco
I need to understand how to do the above valuation accounting it is very confusing to me could you create some steps so that I can follow or a simpler way to understand it. Thank you.
:confused:
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Junior Member
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Mar 14, 2008, 11:02 AM
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lifo is last in first out. Fifo is first in first out.
They're a way of calcultating costs.
Say u buy 5 widgets at 5 dolalrs in month 1, don't sell any
then u buy 10 widgets at 10 dollars in month 2
then you sell 12 widgets. How much was the cogs?
using last in first out, the 10 went first, so $100, then 2 more at 5$, so a total of $110.00
using the first in first out, you sold all 5@ $5.00, or 25, then 7 @ 10, or 70 = total of $95.oo
I'm not to sure what avco is about, still in my second accounting class.
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New Member
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Nov 4, 2009, 09:23 PM
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Avco is average cost of goods sold
Total purchases divided by its units
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New Member
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Oct 19, 2012, 09:24 AM
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I have this question on fifo and avco please anyone can help.
On 1st dec abc company held 300 units goods of 5$
Goods purchased:
11th December 500 units at 11$
19th dec 500 units for 12$
26th December 500 units for 14$
Goods sold:
13th dec 600 units for 18$
21th dec 400 units for 18$
26th dec 200 units for 18$
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