Certified Logistics Technician (CLT) Practice Exam

Question: 1 / 400

What does the acronym LIFO stand for?

Last In First Out

The acronym LIFO stands for "Last In First Out." This inventory management method implies that the most recently added items to inventory are the first to be sold or used. It can be particularly advantageous in industries where the cost of goods fluctuates, as it can help companies manage their tax liabilities and cash flow. By selling the more recently acquired inventory first, a business may report lower profits during periods of inflation, which could lead to tax benefits. This method contrasts with FIFO (First In First Out), where the oldest inventory is sold first. Understanding LIFO is crucial for logistics and supply chain management, as it influences inventory valuation, handling costs, and ultimately impacts overall operational efficiency.

Get further explanation with Examzify DeepDiveBeta

Long Inventory First Out

Large Items First Out

Last Item First Ordered

Next Question

Report this question

Download Certified Logistics Technician (CLT) Practice Exam PDF Study Guide
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy