ЁЯУв Too many exams? DonтАЩt know which one suits you best? Book Your Free Expert ЁЯСЙ call Now!

    Question

    If a company uses LIFO inventory method in falling price

    environment (prices decreasing), then:
    A Cost of goods sold will be low, profits high Correct Answer Incorrect Answer
    B COGS will be high, profits low Correct Answer Incorrect Answer
    C Ending inventory will reflect newer lower prices Correct Answer Incorrect Answer
    D Both A and C Correct Answer Incorrect Answer
    E Both B and C Correct Answer Incorrect Answer

    Solution

    Under LIFO when prices fall, last in are cheaper тЖТ COGS lower тЖТ higher profits; ending inventory higher (older higher cost). Note C is wrong here.

    Practice Next
    More Accounts Questions
    ask-question