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FIFO versus LIFO Notes:FIFOand LIFOaccounting methods are used for determining the value of unsold inventory, the cost of goods sold and other transactions like stock repurchases that need to be reported at the end of the accountingperiod. FIFO stands for First In, First Out, which means the goods that are unsold are the ones that were most recently added to the inventory. Conversely, LIFO is Last In, First Out, which means goods most recently added to the inventory are sold firstso the unsold goods are ones that were added to the inventory the earliest. LIFO accounting is not permitted by the IFRS standards so it is less popular. It does, however, allow the inventory valuation to be lower in inflationary times. Comparison chart FIFOLIFOStands forFirst in, first outLast in, first outUnsold inventoryUnsold inventory is comprised of goods acquired most recently.Unsold inventory is comprised of the earliest acquired goods.