LIFO vs FIFO
| LIFO | FIFO | |
|---|---|---|
| higher COGS | lower COGS | |
| lower taxes | higher taxes | |
| lower net income | higher net income | |
| lower inventory balances | higher inventory balances | |
| higher cash flows (less tax paid out) | lower cash flows (more tax paid out) | |
| lower net and gross margins | higher net and gross margins | |
| lower current ratio | higher current ratio | |
| higher inventory turnover | lower inventory turnover | |
| DA and DE higher | DA and DE lower |
Under IFRS the permissible cost flow methods are:
- Specific Identification
- FIFO
- Weighted average cost
Published: