Inventory Valuation: Analysis of LIFO and Moving Average Cost

This assignment focuses on inventory valuation methods, specifically exploring the Last-In, First-Out (LIFO) method and the moving average cost calculation. The assignment begins with an initial inventory valuation and then analyzes the impact of subsequent purchases and sales on inventory costs. The solution meticulously details the calculation of inventory values using the LIFO method for initial sales, followed by a transition to the moving average method. The assignment provides a table to clearly explain the data and compute the moving average cost, demonstrating how changes in purchase prices affect the overall inventory valuation. The assignment also includes a bibliography of relevant academic sources, providing context and support for the methodologies applied.

Running head: INVENTORY VALUATION
Inventory Valuation
Name of student:
Name of the University:
Authors’ note

1INVENTORY VALUATION
Table of Contents
Table explaining the data and computation of Moving Average Cost:.....................................2
Bibliography:..............................................................................................................................3

2INVENTORY VALUATION
Table explaining the data and computation of Moving Average Cost:
Note: the moving average cost per unit of the ending inventory as on 14th February have been
computed adding the cost of purchase of 400 units and the cost of inventory held before 14th
February and dividing the sum by the total units of inventory after the purchase.
* As per the given information in the case study, all the sales of inventory up to 14th
February have been valued using LIFO method and the inventory as on 14th February have
been calculated using the moving average method as the inventory valuation method changes
from that date.

3INVENTORY VALUATION
Bibliography:
Cachon, G.P. and Fisher, M., 2016. Supply chain inventory management and the value of
shared information. Management science, 46(8), pp.1032-1048.
Hansen, P.K. and Kragh, L., 2016. Method for machine-controlled legal portfolio monitoring.
U.S. Patent Application 14/968,982.
Ionescu, L., Toma, M. and Founanou, M., 2018. Applied Analysis of the Impact of Inventory
Valuation Methods on the Financial Situation and Financial Performance. Valahian Journal
of Economic Studies, 9(1), pp.67-76.
Muller, M., 2019. Essentials of inventory management. HarperCollins Leadership.
Nisha, N., 2015. Inventory valuation practices: A developing country perspective.
International Journal of Information Research and Review, 2(7), pp.867-874.
Simeon, E.D. and John, O., 2018. Implication of Choice of Inventory Valuation Methods on
Profit, Tax and Closing Inventory.
Toomey, J.W., 2017. Inventory management: principles, concepts and techniques (Vol. 12).
Springer Science & Business Media.
Wild, T., 2017. Best practice in inventory management. Routledge.