MGMT 30A Lecture 5: Mgmt 30A Week 4
7
MGMT 30A Full Course Notes
Verified Note
7 documents
Document Summary
Fob shipping point: goods belong to seller until seller delivers goods to shipper-->now belong to buyer (buyer bears goods during shipment) Fob destination: goods are property of seller until buyer receives goods. Specific identification method: company keeps records of original cost of each inventory item, used for unique items. Fifo (first in, first out): earliest purchased goods are sold first, ending inventory consists of most recently purchased goods. Start with unit costs of most recently purchased goods and work backwards until all units have been costed. Lifo (last in-first out): ending inventory consists of earliest purchased goods. Average cost method: worst method, ending inventory and cogs is determined by weighted-average. Divide total cost of all purchased goods by the total number of units purchased to get average unit cost. Multiply average cost per unit by units in ending inventory to get cost of ending inventory.
