Inventory: Inventory refers to the stock or goods which will be sold in the near future and thus is an asset for the company. It comprises of the raw materials which are yet to be processed, the stock which is still going through the process of production and it also includes completed products that are ready for sale. Thus inventory is the biggest and the important source of income and profit for the business. Periodic Inventory System: In periodic inventory system, the changes in the stock items are reported periodically unlike recording as and when purchases or sales take place. Last in First out: In case of Last in, First out, also known as LIFO method, the inventory which was bought in the last will be taken out first. Costs assigned to the ending inventory under periodic inventory system by applying LIFO method.

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Chapter 5, Problem 16QS

To determine

Inventory:

Inventory refers to the stock or goods which will be sold in the near future and thus is an asset for the company. It comprises of the raw materials which are yet to be processed, the stock which is still going through the process of production and it also includes completed products that are ready for sale. Thus inventory is the biggest and the important source of income and profit for the business.

Periodic Inventory System:

In periodic inventory system, the changes in the stock items are reported periodically unlike recording as and when purchases or sales take place.

Last in First out:

In case of Last in, First out, also known as LIFO method, the inventory which was bought in the last will be taken out first.

Costs assigned to the ending inventory under periodic inventory system by applying LIFO method.

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