Hi all! If someone could clear this up, it would be great… There are three inventory costing valuation methods: LIFO, FIFO, Avg Cost. If companies are are to use one of the three, then when would a firm value inventory at the lower of cost, or net realizable value?
LIFO, FIFO and Average cost are inventory cost flow assumptions that are used to determine inventory cost. This cost is then compared to NRV to determine the carrying value of inventory on the balance sheet under IFRS.
Got it, thanks!
ruby, you forgot specific identification as valuation method. just for the record