Accounting JAMB

What type of stock valuation would a vegetable seller adopt in valuing it’s product?

A. LIFO
B. FIFO
C. Simple average
D. Weighted average

Correct Answer:

Option B – FIFO

Explanation

FIFO is a method of stock valuation that stands for ‘First-In, First-Out’. This assumes that the first (oldest) units of stock produced or received are also the first ones that are sold. This is also suitable for perishable items

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