# Last In, First Out (LIFO) Inventory Management

*Last updated: 2026-06-26*

> Warehouse managers and accountants apply LIFO (Last In, First Out) when the most recently received stock is consumed or valued ahead of older inventory.

Warehouse managers and accountants apply LIFO (Last In, First Out) when the most recently received stock is consumed or valued ahead of older inventory. In physical storage, the method arises naturally with bulk materials such as gravel or coal, where retrieving items in strict arrival order is impractical. In cost accounting, LIFO increases reported material costs during periods of rising purchase prices, which lowers the carrying value of inventory on the balance sheet and can have tax implications. It should not be confused with FIFO (First In, First Out), which many jurisdictions require for perishable or hygiene-critical goods. LIFO is not permitted for inventory valuation under IFRS (International Financial Reporting Standards).

**Source:** [https://www.investopedia.com/terms/l/lifo.asp](https://www.investopedia.com/terms/l/lifo.asp)

## Quick Facts

| Property | Value |
|---|---|
| Term | Last In, First Out (LIFO) Inventory Management |
| Language | EN |
| Word count | 111 |
| Last updated | 2026-06-26 |
| Source | https://www.investopedia.com/terms/l/lifo.asp |

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