ACCT 2100 Lecture Notes - Lecture 8: Administrative Controls, Income Statement, Internal Control
Document Summary
This chapter discussed the inventory cost flow methods of first-in, first-out (fifo), last-in, first- out (lifo), weighted average, and specific identification. Under fifo, the cost of the items purchased first is reported on the income statement, and the cost of the items purchased last is reported on the balance sheet. Under lifo, the cost of the items purchased last is reported on the income statement, and the cost of the items purchased first is reported on the balance sheet. Under the weighted-average method, the average cost of inventory is reported on both the income statement and the balance sheet. Finally, under specific identification the actual cost of the goods is reported on the income statement and the balance. The policies and procedures used to provide reasonable assurance that the objectives of an enterprise are called internal controls, which can be subdivided in two categories: accounting controls and administrative controls.
