The first in first out (FIFO) method tracks the actual physical flow (movement) of the goods in a perpetual inventory system.

Name: The first in first out (FIFO) method tracks the actual physical flow (movement) of the goods in a perpetual inventory system.
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FIFO (First-In, First-Out) is an accounting method for valuing inventory that assumes the first items placed into inventory are the first sold, but it does not necessarily track the actual physical movement of goods.

The First in First Out (FIFO) Method Tracks the Actual