Specific Identification Method

[spuh-SIF-ik i-den-ti-fi-KAY-shun meth-uhd]

What is the definition of Specific Identification Method?

An inventory valuation method that tracks and prices each item in the inventory individually, based on the specific cost of each particular item.

Using Specific Identification Method in an Example

In the specific identification method, if a jewelry store sells a necklace, the cost recorded is the purchase cost of that specific necklace rather than an average cost or the cost of the most recently purchased necklace.

Using Specific Identification Method in a sentence

Our company uses the specific identification method for our luxury watches to ensure accurate profit calculation on each individual sale.

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