Inventory Basics: FIFO vs LIFO vs Weighted Avrage | Which Method Saves You Money? скачать в хорошем качестве

Inventory Basics: FIFO vs LIFO vs Weighted Avrage | Which Method Saves You Money?

Welcome back to Accounting Basics! Have you ever wondered why your business shows strong sales but your profits and cash flow don’t match the effort? The hidden problem is often inventory management. In this video, you’ll learn: ✔️ What inventory management really means ✔️ How inventory affects your balance sheet and income statement ✔️ What Cost of Goods Sold (COGS) is and why it matters ✔️ The difference between FIFO, LIFO, and Weighted Average methods ✔️ How inventory impacts cash flow (and why profit doesn’t equal cash) ✔️ Common inventory mistakes small businesses must avoid We use a simple, practical sneaker business example to show how: Buying 100 units at $50 ties up $5,000 in working capital Inventory is recorded as a current asset Inventory becomes an expense only when sold (COGS) Selling at $120 creates gross profit—but timing changes everything You’ll also clearly understand: 📌 FIFO (First In, First Out) – Higher profits during inflation 📌 LIFO (Last In, First Out) – Lower profits, potential tax advantages (where allowed) 📌 Weighted Average Method – Simplified, practical costing Most importantly, we explain how poor inventory planning can choke your cash flow—even when your business is growing. Whether you're a small business owner, entrepreneur, accounting student, or someone learning financial literacy, this video will help you understand one of the most powerful profit drivers in business. Master inventory, and you master cash flow, profitability, and smarter decision-making. #InventoryManagement #AccountingBasics #COGS #CashFlowManagement #SmallBusinessFinance #FinancialStatements #Entrepreneurship #BusinessAccounting #FIFO #LIFO #Weightedavragemethod