With accounting, the income, expenses and the assets of your business will be monitored. Being a Public accountant, a Management Accountant, a Government auditor and accountant matters in the field of business.

Accounting - The Tool of a Good Business

In Accounting, there are three techniques used to manage inventory. Inventory is all the goods or items held available by a business. The keeping of old inventory can also result in aged, obsolete inventory. LIFO liquidation is when a company has to liquidate its older cheaper inventory. The older cheaper goods are matched with higher, current sales prices therefore inflating the profits and making the business liable to higher taxes.

This allows an organization to clear out its older inventory, which prevents the aging of items and lowers the possibility of inventory decay and inventory liquidation. The older inventory they are getting rid of is limited and if inventory prices rise their profits will fall. Those companies who have large inventories of undifferentiated product use the weighted average method. This method is generally in between LIFO and FIFO in regards of profit recording, FIFO reports the highest, LIFO the lowest and weighted average in the middle of the two. Weighted average usually refers to the cost flows of inventory, and usually not their physical , (2010).; Last In, First Out – FIFO. Retrieved , (2010). First In, First Out – FIFO. Retrieved , (2010). Weighted Average.