Hello in this lecture we’re going to talk about estimating inventory methods methods such as first in first out last in first out and the average method. Last time we talked about specific identification when we were selling the inventory of forklifts. We use specific identification meaning we had an ID number for each particular forklift and knew exactly which forklift we sold and the cost of that particular forklift. reason that makes sense for forklifts is because they’re relatively large, they could be distinct in nature, and they have a fairly large dollar amount in comparison to other types of inventory. If we’re selling something else, like coffee mugs over here, we may have a large amount of coffee mug they may be all completely the same.
