(1) Specific identification<br>
Actual Physical flow
Specific identification method tracks the actual physical flow of the goods<br>
Small volum but high value: COGS= Inventory had sold
卖掉的就是COGS, 没卖掉的就Iventory
Cost of goods sold depends on which item is sold<br>
Suitable for goods with high value but small volume
Periodic Inventory System – Specific Identification Method<br>
COGAS-Ending Inventory on hand =COGS
Assumed Cost Flow Methods<br>
(2) First-in, first-out (FIFO)<br>
The earliest goods purchased the first to be sold<br>
GOGS:The earliest goods purchased the first to be sold<br>
Ending inventory : items purchased late in the year.倒着做账<br>
(3) Average-cost<br>
Assumes that the goods available for sale are homogeneous (the same).<br>
Cost of Goods available for sale: based on the weighted average unit cost.
Average Unit Cost = the COGS /units available for sale
Suitable for identical goods with large quantity<br>
