This study aimed to analyze the factors that influence the selection of
inventory valuation method to be used. This study examined four independent
variables are the variability of inventory, company size, gross profit margin and
ownership structure. The dependent variable in this research is the method of
inventory valuation method consists of average and FIFO method. Data analysis
was performed using SPSS version 16.
The results of the study are as follows: (1) the variability of inventory does
not affect the selection of inventory valuation method, (2) the size of the
company's positive influence on the selection of inventory valuation method, (3)
gross profit margin of a negative influence on the selection of inventory valuation
method, (4) the structure ownership does not affect the selection of inventory
valuation method.