VideoDavid M. Katz, CFO.com | US
December 3, 2007
- LIFO or FIFO
What i think, is each company should be allowed to use their own method of accounting cost, be it LIFO, FIFO or Averge method. However, different companies or organisation have different inventory operations.
Posted by MUHAMMAD HADI ABDULMUNAF | Nov 4, 2009 8:42 AM ET
- LIFO yields a better Fair Value measurement
As stated in the article, LIFO presents a more accurate picture on the income statement; however, at the expense of the balance sheet. Inventory on the balance sheet may represent the cost of inventory 50 years ago (a historical cost) clearly not the fair value of it today. Therefore, LIFO is not a better measure of fair value when taking the financial statements in its entirety; it is just a different method with different strengths and weaknesses.
Posted by Jeremy Fischer | Dec 4, 2007 9:45 AM ET
- Nevermind...
I think I've got it backwards...
O'm just to focused on the Income Statement I guess.Posted by Tim Wiese | Dec 4, 2007 9:42 AM ET
- LIFO yields a better Fair Value measurement
With all the emphasis under IFRS on fair value accounting, I would think LIFO would be more prefered than FIFO...
FIFO clearly relies more heavily on historal purchase cost and less on replacement cost as a means of valuation...
Am I missing something?Posted by Tim Wiese | Dec 4, 2007 9:22 AM ET
