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Essay / Research Paper Abstract
This 8-page paper discusses the importance of inventory accounting to a business. The paper discusses the definition of inventory accounting and also explains in detail two of the popular methods, LIFO and FIFO. Bibliograph lists 5 sources.
Page Count:
8 pages (~225 words per page)
File: D0_MTinvacc.rtf
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Unformatted sample text from the term paper:
the costing methods, which tends to measure everything by cost broken out between departments. There is Activity-Based Costing, or ABC, which measures revenues directly against the costs incurred in creating
products or services (and creating those revenues, in fact). Then there is inventory accounting, which is used to value inventory.
Inventory accounting has pretty much been around since the invention of the double bookkeeping method because its a fairly simple standard. What inventory accounting
does overall is consider the value of inventory and compare it against the cost of goods sold (or even the cost of inventory manufacture). But as well see in this
paper, there is a good deal more to inventory accounting than simply examining costs against assets. There are methods even within inventory accounting to judge this.
The purpose of this paper is to thoroughly examine inventory accounting, discuss why its important to a business and provide a brief overview of the system.
Then well delve deeper into two inventory accounting methods - LIFO and FIFO, and discuss the benefits and problems of each one.
Well also offer an explanation of simplified LIFO, which is fast outpacing FIFO as the inventory accounting method of choice. What is Inventory Accounting?
In its most basic form, the concept of inventory accounting is pretty much self-explanatory. The basic definition here is that inventory accounting is a procedures that controls and
values inventory (Hyperdictionary.com, 2003). This type of accounting is pretty much used in situations in which a lot of inventory is valued as assets, such as retail establishments. As service-oriented
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