This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

- How the FIFO method assumes the first units purchased are the first ones sold, typically resulting in higher taxable income during inflationary periods.

- How the LIFO method assumes the last units purchased are the first ones sold, leading to a higher Cost of Goods Sold (COGS) and lower taxable income when prices are rising.

- The critical LIFO conformity rule, which mandates that if a business uses LIFO for tax purposes, it must also use it for financial reporting.

- The procedural requirement of filing Form 970 with the IRS to properly elect the LIFO inventory method.

- The application of the Specific Identification method for unique, high-value inventory items where the actual cost of each item can be tracked.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep