Perpetual FIFO

Perpetual FIFO is a cost flow tracking system under which the first unit of inventory acquired is presumed to be the first unit consumed or sold. In addition, this cost flow occurs under a perpetual inventory system, where inventory inflows and outflows are recorded in the inventory records as soon as transactions occur. There is no difference between the resulting charge to the cost of goods sold if a perpetual inventory system or a periodic inventory system is used.

Perpetual FIFO is one of the most common cost flow tracking systems in use today.

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