first in, first out

first in, first out
A method of accounting for business inventory permitted by GAAP. American Banker Glossary
An accounting method for valuing the cost of goods sold that uses the cost of the oldest item in inventory first. Bloomberg Financial Dictionary

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first in, first out first ˌin, first ˈout abbreviation FIFO noun [uncountable]
1. ACCOUNTING FINANCE a method of calculating the value of goods or materials a company has in stock, based on the idea that those put in stock first were the first ones sold or used. Any stock that is left at the end of the year is valued at the cost of the most recently bought stock:

• Since inventory is costed on a first in, first out basis it is assumed the oldest inventory is used up first, leaving the newest inventory to be priced at the current higher prices.

— compare last in, first out
2. MANUFACTURING a method of controlling stock in which the first items to be produced or bought are the first ones to be used or sold
3. COMPUTING a system in which a computer begins to process its instructions in the exact order in which they are received
4. HUMAN RESOURCES a principle sometimes used when a company has to make people redundant, which says that the first people to have started working there will be the first ones to lose their jobs

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first in, first out UK US noun [U] (ABBREVIATION FIFO)
ACCOUNTING the method used to calculate the value of products or materials, in which the first ones that are bought or produced are said to be the first that are sold or used. At the end of the year, the value of the ones that have not been sold or used is calculated using their most recent cost: »

Inventory is valued at currently adjusted standards which approximate actual costs on a first-in, first-out basis.

PRODUCTION the method of controlling stock, in which the first products or materials that are produced or bought are the first that are sold or used
IT the system by which a computer reads and deals with data in the order in which it receives it
HR the situation in which, when a company needs to reduce its number of employees, the first people who were employed are the first to lose their jobs
Compare LAST IN, FIRST OUT(Cf. ↑last in, first out)

Financial and business terms. 2012.

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