First-in, first-out process-costing method

First-in, first-out process-costing method (FIFO process-costing method) is method of process costing that assigns the cost of the previous accounting period's equivalent units in beginning work-in-process inventory to the first units completed and transferred out of the process, and assigns the cost of equivalent units worked on during the current period first to complete beginning inventory, next to start and complete new units, and finally to units in ending work-in-process inventory.

Definitions

According to Cost Accounting by Horngren, Datar, Rajan (14th edition),

First-in, first-out process-costing method (FIFO process-costing method). Method of process costing that assigns the cost of the previous accounting period's equivalent units in beginning work-in-process inventory to the first units completed and transferred out of the process, and assigns the cost of equivalent units worked on during the current period first to complete beginning inventory, next to start and complete new units, and finally to units in ending work-in-process inventory.