Under the FIFO inventory assumption the cost of ending inventory and cost of goods sold will be the same under both the perpetual and periodic inventory systems.

Question

Quizplus · Accepted Answer

Under the FIFO inventory assumption, the oldest costs are assumed to be the first ones sold, so the cost of ending inventory will be based on the most recent costs. Since the cost of ending inventory and cost of goods sold both use the same oldest costs, they will be the same under both the perpetual and periodic inventory systems.

Under the FIFO Inventory Assumption the Cost of Ending Inventory