Determine Cost of Inventory - Financial Accounting

The video tutorial discusses how to calculate inventory costs and the cost of goods sold, emphasizing the importance of understanding all associated costs, including invoice and incidental costs. It introduces the matching principle, which aligns inventory costs with revenue. The tutorial outlines four methods for calculating inventory costs: specific identification, first in, first out (FIFO), last in, first out (LIFO), and weighted average, explaining that three are assumptions while one is factual.

Describe the specific identification method of inventory cost calculation.

What is the difference between FIFO and LIFO methods in inventory management?