Final answer:
FIFO periodic and FIFO perpetual may not always produce the same dollar amounts for cost of goods sold due to differences in timing and accuracy of the calculations.
Step-by-step explanation:
FIFO (First-In, First-Out) is a method of inventory valuation, where the cost of goods sold is based on the assumption that the oldest inventory is sold first. FIFO can be used in both perpetual and periodic inventory systems. However, it is important to note that FIFO periodic and FIFO perpetual may not always produce the same dollar amounts for cost of goods sold.
In a FIFO periodic system, the cost of goods sold is calculated periodically, usually at the end of an accounting period. The calculation involves determining the cost of the oldest inventory on hand and multiplying it by the number of units sold.
On the other hand, in a FIFO perpetual system, the cost of goods sold is calculated in real-time for each individual sale. The cost of the oldest units in inventory is assigned to each sale, resulting in a more accurate and up-to-date calculation of cost of goods sold.
So, while both FIFO periodic and FIFO perpetual use the same method of valuing inventory, the timing and accuracy of the calculations may vary, leading to potentially different dollar amounts for cost of goods sold.