Last in, first out (LIFO)

Definition:

An accounting method that fixes the cost of goods sold to the most recent purchases. Hence, if prices are generally rising, LIFO will lead to lower accounting profitability.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Discounting the news

An adjustment of a stock's price as speculators bid the price up or down in anticipation of news about the company, whether good or bad.

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