1. Home
  2. Peer Review: Perpetual Inventory Valuation Method: FIFO

Peer Review

Perpetual Inventory Valuation Method: FIFO

Reviewed:

Jul 10, 2019 by Business
Bookmark

Ratings

Overall Rating: 4.5 stars
Content Quality: 4.8 stars
Effectiveness: 4.8 stars
Ease of Use: 3.8 stars
Overview:

This video provides an explanation of the First-In-First-Out (FIFO) concept of inventory valuation. The use of FIFO is explained within the concept of inventory valuation methods. The complementary idea of Cost of Goods Sold and an explanation of how it is derived during the FIFO inventory valuation process is explained. This tutorial is accessed through YouTube and is very easy to use.

Type of Material:

Tutorial

Recommended Uses:

Homework, individual, in-class, lecture.

Technical Requirements:

Reviewed using the Chrome browser.  The item is a YouTube video.

Identify Major Learning Goals:

 

  1. To learn to use FIFO to compute ending inventory.
  2. To apply FIFO to perpetual inventory situations.
  3. To differentiate between Cost of Goods Sold and Ending inventory.
Target Student Population:

For high school and lower division college audiences learning inventory methods in a financial accounting class.

Prerequisite Knowledge or Skills:

Interest in accounting, inventory principles (namely perpetual inventory), and accounting or mechandising organizations.

Content Quality

Rating:
Strengths:

 

  • This video provides a good demonstration of the FIFO inventory valuation concept.
  • The material is accurate, current, and relevant in terms of current accounting practice.
  • Concepts are demonstrated completely, and a critical analysis to explain the derivation of Cost of Goods Sold is included. 
  • The author uses an Excel spreadsheet accompanied by verbal explanations to illustrate the concepts.  The example shows shows three layers of costs which is sufficient to explain the concept. 
Concerns:

 

  • The image quality was relatively low, and items in the screenshot are blurry.
  • This tutorial is limited in its flexibility since it pertains to FIFO and Cost of Goods Sold computations only.
  • The quality of the content is moderate in that the presenter does not indicate in any way where she is on the page during the presentation, which makes it difficult to follow along.  

Potential Effectiveness as a Teaching Tool

Rating:
Strengths:

 

  • The presenter in this tutorial clearly explains how FIFO is a part of the inventory valuation methods used in financial accounting, and that it is one of four methods used.
  • The video is a simple, but effective, presentation using an Excel worksheet to keep quantities of items separate from computed dollar amounts.  The proof of each solution is provided to enhance understanding.
  • The concept of FIFO is reinforced throughout the video, and the relation to Cost of Goods sold is emphasized.
  • The author does a good job highlighting the point that inventory problems need to be categorized carefully as to the question being asked.  Is it the ending inventory or cost of goods sold calculation being sought?  
  • Students could gain a better understanding of FIFO inventory valuation within a few minutes with this video.

 

 

Concerns:

 

  • This material is not suited for measuring student learning outcomes, because it is not interactive by its very nature.
  • The video is a moderately good teaching tool but is limited due to the lack of an interactive component.

Ease of Use for Both Students and Faculty

Rating:
Strengths:

 

  • This YouTube video is very easy to use and can be accessed from any internet-connected device. The instructions to use it are simple and easy to follow.
  • Some might find that staring with an Excel spreadsheet is less than engaging, but this arrangement of numbers (quantities and prices) is necessary to understand the concept. 
  • The video is brief, and as a result focus should be able to be maintained throughout.  Cursor movement is an effective visual to show the area of focus within the spreadsheet. 
  • Upon using headphones, the pace and articulation of the video was fine.
Concerns:

 

  • Volume of the video was low and without headphones, could not be readily heard.
  • Closed captioning is available; transcript is ok, although lacks starts and stops of sentences.
  • The material is not very engaging since the visual remains the same throughout the entire presentation.
  • Visual appeal is low, because it is a black and white spreadsheet that is out of focus.
  • This material in not interactive in any way and does not meet accessibility requirements. 
Creative Commons:
creative-commonscreative-commons by