Obviously this method has every limited application in most instances, because of the impossibility or impracticability of segregating specific items as coming from separate purchases.
This phenomenon was determined by particularity of producing and selling,turnover velocity of receivable account and stock-in-trade,cashability of receivable account and the amount of payable account.
In 2006, the current ratio and the quick ratio of the company rose fast.The inventory turnover ratio was high.The cashability of the current assets was strong and outperformed the industry average.