FIFO method

The **FIFO method** (First-In, First-Out) is an inventory valuation and management technique where the earliest goods purchased or produced are sold or used first. This approach helps businesses accurately track the cost of goods sold and remaining inventory, ensuring financial statements reflect the most recent prices. Commonly used in accounting and supply chain management, the FIFO method is especially beneficial in industries with perishable items or goods that have a limited shelf life.