CFA Practice Question

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CFA Practice Question

What does the FIFO inventory method assume about the first units purchased?

A. They are the first units sold.
B. They are the units that remain in ending inventory.
C. They are the only units used in computing average cost.
Correct Answer: A

FIFO treats the first units purchased as though they are the first units sold.

User Contributed Comments 2

User Comment
jasonkwk1 FIFO =first in first out
gomonzur Got it right
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