[angelitomarquez]

Hi, I need to know which are the main aspects to consider before implement a cost system for example average, standard, fifo, lifo. Does it depend on the company activities?
Thanks in advance

[rehmanvohra]

There are many factors to consider, among them is the nature of the manufacturing activity, is it a job order oriented, process, service or operations oriented?

It would be more appropriate to use average method. It is easy, convenient and easily understood.

Standard costs require elaborate system of determining costs which a small or medium sized industry may not be able to afford.

FIFO/LIFO are best for description purposes, but in practice no one seriously follows. Again LIFO is not applicable for accounting reporting purposes, hence requires restatement using either FIFO or average.

[morgaine300]

It partly depends on where you're at (and therefore what you're allowed to use) and a lot on opinion, and on the nature of the inventory.

It would help to know where you are, what type of inventory you are talking about, and perhaps even the basic nature of the business.