LIFO is preferred when costs are rising and managers have incentives to report higher income because of bonus plans and job security.

Name: LIFO is preferred when costs are rising and managers have incentives to report higher income because of bonus plans and job security.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

LIFO (Last-In, First-Out) results in higher cost of goods sold and lower net income when costs are rising, which is not preferred if managers want to report higher income for bonuses or job security.

LIFO Is Preferred When Costs Are Rising and Managers Have