In a period of rising prices, if a company uses the FIFO cost flow assumption, income tax expense will be lower than if they used average-costing.

Name: In a period of rising prices, if a company uses the FIFO cost flow assumption, income tax expense will be lower than if they used average-costing.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

In a period of rising prices, FIFO results in lower cost of goods sold and higher taxable income compared to average-costing, leading to higher income tax expense.

In a Period of Rising Prices, If a Company Uses