First In First Out (FIFO) | Inventory Cost Flows
ฝัง
- เผยแพร่เมื่อ 28 พ.ค. 2024
- 💥Inventory Cost Flow Assumptions Cheat Sheet → accountingstuff.com/shop
In this video you'll learn about Inventory Cost Flow Assumptions. There are three of these:
▪ FIFO - First In First Out
▪ LIFO - Last In First Out
▪ AVCO - Weighted Average Cost Method
This accounting tutorial focusses on FIFO. You'll discover how the First In First Out method works and get to practice using it with an example. This episode is part of a mini-series exploring Inventory in Accounting. You can find the link to the whole playlist here ⬇️
🔗Full Inventory Playlist → • Accounting for INVENTO...
🔴Subscribe for more Accounting Tutorials → geni.us/subtothechannel
⏱️TIMESTAMPS
00:00 - Intro
01:02 - When do we need Inventory Cost Flow Assumptions?
02:09 - What are Inventory Cost Flow Assumptions?
02:19 - The three assumptions: FIFO, LIFO and AVCO
02:41 - How FIFO works (First In First Out)
03:01 - Accounting with FIFO - Example
04:02 - Step 1: Draw an Inventory Cost Flow Table
04:19 - Step 2: Enter what you know
06:09 - Step 3: Fill in the blanks
09:00 - Step 4: Cost of Goods Sold and Closing Inventory
09:42 - Advantages of FIFO
10:08 - FIFO vs LIFO vs AVCO
10:20 - Disadvantage of FIFO
🔝 CLOUD ACCOUNTING SOFTWARE
▪ QuickBooks Online USA (FREE TRIAL/DISCOUNT) → geni.us/jA9N
▪ QuickBooks Online Canada (FREE TRIAL/DISCOUNT) → geni.us/bNN7
▪ Xero (FREE TRIAL) → xeroamericas.grsm.io/ck90eoq1...
🔎FAQ
▪ My Favourite Accounting Book for Beginners → geni.us/5mKR7m
🚶FOLLOW ME ON
▪ Instagram → / accountingstuff
▪ TikTok → / accounting_stuff
▪ Facebook → / thisisaccountingstuff
🎬LEARN ACCOUNTING BASICS FOR FREE
▪ The Full Playlist → • ACCOUNTING BASICS for ...
________________________
DISCLAIMER
Some of the links above are affiliate links, where I earn a small commission if you click on the link and purchase an item. You are not obligated to do so, but it does help fund these videos in hopes of bringing value to you!
________________________
#accounting #accountingbasics #accountingstuff
The LIFO and AVCO videos are live! Link to the whole Inventory Playlist is in the video description.
⏱️TIMESTAMPS
00:00 - Intro
01:02 - When do we need Inventory Cost Flow Assumptions?
02:09 - What are Inventory Cost Flow Assumptions?
02:19 - The three assumptions: FIFO, LIFO and AVCO
02:41 - How FIFO works (First In First Out)
03:01 - Accounting with FIFO - Example
04:02 - Step 1: Draw an Inventory Cost Flow Table
04:19 - Step 2: Enter what you know
06:09 - Step 3: Fill in the blanks
09:00 - Step 4: Cost of Goods Sold and Closing Inventory
09:42 - Advantages of FIFO
10:08 - FIFO vs LIFO vs AVCO
10:20 - Disadvantage of FIFO
Thanks sir you helped me for fifo and now i am going to watch lifo and tomoraw my exam thanks sir💪💪
@@abdirisakabdimahadahmed1536 Let me know how it goes
@@AccountingStuff sir my exam goes well i thinks i will 50/60 thanks sir💪💪
@Accounting Stuff the one you did is one sale plz do another one with 3-4 sales plz
@@alimoha9431 yes please do the one with more than one sale
When you don’t go to class and watch accounting stuff instead.... while getting better grades
Your emblem is from a good bood called. Bunker or something.
It is actually insane that you have made these accounting topics interesting. You just saved a grade (and a life :D ) thank you so much!!
Best of luck in your studies!
I swear you make everything my teacher teaches me sound easy and clear af. Thanks a lot!
You are an absolute life saver! Totally better explanations and better examples than the textbook i have rn. So grateful that I found your channel.
Wow just today you came out with the video I needed for my final tomorrow! Thanks so much, you've taught me twice as much as my teacher. Keep it up! I may actually pass because of you :)
Love from Canada
Perfect timing :) Good luck in your exam, hope you ace it!
Currently clearing up the confusion in my head after learning this class. So helpful , thanks James!!
Just bought all of your all in one cheat sheet bundle and I've never been happier doing accounting! Thank you so much!
Thanks for your support, I appreciate it! It's great to hear that you're enjoying accounting :)
newbie to the world of Accounting and knew absolutely nothing about it. With your amazing videos I scored an A- for my final grade! Yay! Thanks so much!
And here I am finding out about this guy 2 years later after the video is posted 😌 but the value of the video feels like it was posted today❤️ priceless
Amazing content!!
Very well explained. It was way better than the explanation provided my lecturer. This is the best channel for accounting I came across so far. Thank you very much for this and I hope you continue putting videos on accounting.
Super cute! And clear and relatable explanations !! You rock!
Just when needed my guardian angel is there😍
Thank you so much your videos are better than the three hour class revision on a weekend 🙏💗🥹
I wish I could've found this amazing channel earlier. Thank you for the great content and wish you a happy new year🎊
Best youtube channel ever. Thanks for your effort doing this incredible job! I truly love it
Thanks Enrico!
I've been watching your videos now for a couple of months. Thankfully I discovered your channel when I started my undergrad in accounting. I started watching your videos simultaneously with my class lessons. I decided to stop procrastinating and go ahead and purchase your combo pack of all the cheat sheets. Not only do I need them lol but I also wanted to support you and your channel because I truly appreciate the time and effort you put into these videos and sharing your knowledge with us for free. I love your videos and all the animation and emotion you put into them. Your good looks and British accent is an added bonus :).
Hey Adrienne, thanks for your support! I appreciate it. All the best with your course, hope it's going well :)
@@AccountingStuff Thank you James!
Do you think you'll do a video on petty cash? It seems pretty simple and straight forward but I seem to still get hung up on some of the concepts. Thanks in advance
@@adriennejones2148 Cheers for your request, I'll keep that topic in mind for future vids!
I love the way you holding the squeegees in the entire video
I love the way you explained each thing in detail
Thanks, I'm glad you enjoyed it :)
Haven't learnt this topic at school yet hope this knowledge comes in handy soon lol
Can't stress how crucial your work on this channel is!
I hope so too! All the best
you literally have a video for everything! thank you!!!
You're welcome :)
Thank you so much! Before, I know the calculations, but I want to look for some more explanations just for me to know the sense and the principle of what I am computing. When I watched your video, everything makes sense now 😊😊😊
Love the editing!! :)
You are amazing! I thought that I would never understand (as a chemist) accounting!
exceptional timing, this is on my test tomorrow.
Thanks fort the great video!
How did it go??
Accounting Stuff it was definitely a tricky one because of the questions about bonds and shares, but I absolutely nailed the subjects you‘ve covered in your videos. Great work!!!
@@Xoxooxoxoxooxoxo Nice one! Fingers crossed for a high score
Keep going brother!
You are doing a great work!
Cheers!
Good Job! Keep going bro!!!
Thank you for saving me, I almost dropped out HCS/380 until I found your video. Thanks a million!!!! times
thank you, James your video really help me to improve my career.
This really helped, thank you.
You're welcome!
Thank you so much James!!! After watching this video I've finally figured out how to use FIFO!!!!!!
From Taiwan 🇹🇼
Nice one! Glad to hear it's clicked
omg I'm learning this too and it's so hard like I don't get the Taiwanese teachers lol
Thank you so much for these videos
Your videos are truly amazing. Honestly, I would’ve never passed accounting if it wasn’t for you. Have a good one ♥️🙏🏼
Congrats on your pass Yumna! 🎉👏
this makes my life so much easier, I can’t understand anything in the material they gave us.
That's great to hear!
Thank you so much :) your videos are amazing and easier to understand!
Thanks, I'm glad you're finding them useful :)
I've watched many videos but i did not understand. After watching very that video, i felt how the topic was easy. Thank you man!😇
Great to hear it's making sense!
Thank you! It's the best!
Great Vid!
Can’t wait for the next one.
Thanks Amy!
Ive just learned it yesterday and didnt understand anything. Luckily I see your video today. Thank youuu. Hope that you will upload LIFO and AVCO soon.
Great timing! Hope it's making sense
Another day another fantastic work 🌟
Thank you :)
you just saved my life omg
Thank you man, your videos have helped me a lot.
No problem, I'm happy to help :)
you are saving my life thank you!!!
No worries :)
studying for my state FBLA accounting test next week - got third in region, now aiming to win in state and go for nationals!
Congrats!! Good luck in your test
i just realised, 440 + 280 x 3 doesnt give you 840 but 2160. Im confused, am i missing something? @accounting stuff
You explained this amazingly! Seriously you’re videos have helped clear up a lot of the confusion I had for my class. I might actually pass 😂
Managed to explain in like 10 minuets what I haven’t been able to understand in a week!
Great to hear you're finding these useful!
Thank you James, I really value your work. Please make a video on Discount allowed and discount received.
And briefly explain the difference between two-column and three-column cash books. Thanks
Hey Evans, thanks for your suggestions!
Very useful!!! Thanks a lot.
From Italy😃
Cheers Lukas!
Well Explained video!! Just Like it
Cheers!
Nice teacher, understandable video !
Thanks!
Why is the window cleaning always the example 😂
you're the best man
It just worked out that way at the time
I am going through ABasics for beginners playlist, I should say that this are the best explanations I have ever heard of. However, I have a small question for this video. Shouldn't we just increase the selling price of our goods with a higher cost accordingly? As given increases will shrink our profit margins. Thank you!
you are a legend ,, thank you
Cheers Fahed!
Helpful as always
Thanks!
I'm actually watching this for work instead of for college (I'm a report programmer) with my original skills only being in programming and none in economics xD So this helps tremendously.
Hope it helps!
You’re so cuteee! ☺️ You should show how to use those future value or present value of $1 tables. Still haven’t gotten that down
Thanks Emina!
thanks
watching your videos, make it redundant to read the confusing textbook we got from our university
Thank you so much!
No worries!
looking forward to talking about sales allowances and returns in next video !!!!!!!
great video! :)
Ooh Wee, 5 more videos left in the marathon.
hey, could you talk about the specific identification method as well? your videos are super helpful!
Hey Isabel, thanks for your suggestion! I'd like to cover that soon
James, you're so amazing! Do you do any private tutoring or do you have any paid-for series?
Thank you for this..i was never taught in school but it came out in my exams
Hope the explanation helped
@@AccountingStuff yes it did
Thanks
Thank you!
You're welcome :)
Nice explanation James
I want an accounting cycle problem
I know it was in your list
Thanks Munesh, I haven't forgotten! The Accounting Cycle is a beast and I want to do it justice
Thx! nice video:)
No worries :)
Thanks!
Thanks Omar! Very generous of you
Hey, awesome informative videos as always. I am taking Financial Accounting and was wondering, do you ever tutor?
Cheers! Unfortunately I don't do 1 to 1s
Just osm bro.
Appreciate!😃
Thanks!
Keep up the good work.
Can you please make a video of budgeting?
Cheers Sepideh, thanks for the suggestion!
I don't like learning inventory accounting but it seems so important.
Nice video .
Thanks Chemla!
from east africa somali
good lecture👌✋
Thanks mate!
thank you so much
You're welcome :)
thank you bro
You're welcome :)
You're a god
Lol your intro is always the same 😂😂😂 and I love how you say math ☺️
Since Quickbooks does a lot of these procedures automatically, do you have a video on where you would step in from there for reviewing and correcting?
what if there is more than one addition? do we just add the quantities for additions and put it in the table or do we repeat additions twice on the table?
the goat
Saved my final
Hope it went well!
Heeey first thank you sooo much those videos helped me a lot
I have question about it video
I'm confused where 280 UNITS come from ?
I also got confused but I watched it again. So he got the 500 units sold and subtracted 220 units because it is the opening amount. First In First Out 500-220=280. Pretty much he subtracted the older units first (220).
Can you explain accounting in long term liabilities? Bond financing?
Hey Clarisa, thanks for your suggestions!
Tomoraw is my exam wish me the best and i wish you the best thanks sir❤❤
Hope you crush it!
Do you have any printables of the examples you do in the videos? I bought your cheat sheets but examples also help me understand.
Thanks for your support! Unfortunately I don't at the moment, but that's a great idea
Do we calculate the value of the inventory that we posses in our godown or do we calculate the value of inventory for the inventory that we ownership for regardless of where the stock/inventory is physically
Let’s say, I’ve sent goods to my agent(on a consignment basis). Do I have to deduct the value of stock from my inventory? But I still own the goods although I don’t have them physically in my godown
Thanks شكرا
this made everything easier but the tables we use in class are different and it's throwing me off I understand it a bit better now tho thanks for making a video i knew i was gonna find principles of costing on ur channel
That's great to hear :)
how would i process a returned item to inventory with FIFO on the inventory table?
Brilliant sir. Very helpful.
But can I make a suggestion? Go buy yourself a decent mic, and record in rooms with less echo, or hang something that absorbs sound. It would add an extra layer of professionalism to your already very professional video editing and excellent information.
Keep up the great work. :) *
*I just noticed this was made 3 years ago. If you've improved the sound quality since then, obviously, disregard the second part of my comment. :)
What is the effect when using FIFO instead of LIFO/AVCO when prices rising?
what types of payments do accept for your cheat sheet
Hi James, nice video once again. I have one question. How do you keep track of the various units in your inventory? In you example, at the end of the month you sold all your $2 units and you only have $3 units. But what if at then end of the month you have $2 units and $3 units. Do you create an inventory account for each price group of units?
Also, what happens if you first bought units for $2, then units for $3 and then again units for $2. I assume you don't merge the $2 unit groups in the FIFO case because you're working from old-to-new.
Sure thing. This video was very theoretical. In reality a lot of businesses would use some kind of Accounting Software which can track all of the prices for you. However, if you were working it out for yourself then you might need to keep a separate spreadsheet to track the cost prices of your Inventory on hand.
If you bought $2 units first then you'd sell those first, followed by the $3 units and then the $2 units. Always First In First Out.
Hope that helps
@@AccountingStuff It helps. Thanks :)
@@AccountingStuff what is the best accounting software for this? I need to keep track of inventory and cost of goods, which constantly change because our products are constantly on promotions, cost prices change month by month.
HEYA can u do a video on correction of errors . that'll really help
Thanks for your suggestion!
We meet again! I have an assessment due Tuesday on FIFO, LIFO and AVCO! Help!!!
Hope it goes well!
@@AccountingStuff it did thanks for all the help!!!
I hav my paper on 15th december. please make videos on LIFO and AFCO
I'm working on them right now
Hi James please do class on Fixed Assests
Hey Pavan, thanks for your suggestion!
Squeegee! lol I definitely laughed a little
could you also do a video on company accounts . thanks :)
Thanks for your suggestion!