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What is Cost of Goods Sold (COGS), and where is it reported? How is Gross Profit calculated, and what does it represent?
First in First out, is an inventory tracking method where anytime product is sold, the cost of goods is charged at the price of the oldest item in the inventory. This is most effectively used when the goods sold at the beginning of the month are significantly lower than the later purchases. The next method is called last in last out.