(1) An inventory valuation method that assumes the newest inventory (last-in) is sold first (first-out) (vs. FIFO). (2) The method of determining the taxable portion of a random withdrawal from an annuity. Taxable earnings are treated as being withdrawn before the tax-free return of contributions.
The valuation principle assuming that the stock of a certain product received last is sold or consumed first. By this method the stock can be valued at (normally lower) prices from the past, whereas the material consumption is valued at (normally higher) relatively up-to-date prices.
Characteristic of a queue in which the last item put into the queue becomes the first item to be taken out of it
A method of valuing inventory and cost of goods sold under which the items purchased last are assumed to be sold first.
method of inventory valuation that assumes that the most recently purchased or produced goods are sold first.
A method of inventory costing based on the assumption that the most recent merchandise costs incurred should be charged against revenue.
An inventory valuation method that allocates cost on the assumption that the last units acquired are the first units consumed or sold.
A rule that applies to the sale of part of a group of similar items; the rule assumes the last items acquired were the first ones sold. Used of this assumption can make a big difference in tax liability if items in the group were acquired or manufactured at different times or for different costs. See also " First-in, first-out (FIFO)."
It is the opposite of the FIFO method. It assumes that the material, which is acquired last, is issued first. Hence material issues are priced on the basis of the cost of most recent material purchases. This method of valuing inventory is preferred in periods of rising prices, as the method tends to depress reported profits and thereby, dividends are kept low, and working capital is conserved.
A rule that applies to the sale of part of a group of similar items in an inventory that assumes the last ones acquired were the first ones sold. This is important if the items in the group were acquired or manufactured at different times or for different costs. (See "First-in, first-out (FIFO).")