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Sagot :
Crane Corporation switches from the FIFO approach to the weighted-average method for managing its inventories. The income statement will be impacted by things such as net income, cost of goods sold, and earnings per share.
The main distinction between a weighted average and FIFO is that the weighted average approach utilizes average inventory levels to determine inventory value whereas FIFO uses the first acquired products to determine inventory value.
The FIFO technique is consequently better suited since it does not add the costs of the current period to those of the past period. But when using the weighted average method, costs from both the present and past eras are included. As a result, the suggested pricing is incorrect.
To learn more about FIFO
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