In a period of declining prices, which of the following inventory cost formulas generally results in the lowest inventory figure on the statement of financial position?
A)average cost
B)FIFO
C)The figure would be the same under both FIFO and average cost.
D)Need more information to answer.

Question

Quizplus · Accepted Answer

In a period of declining prices, FIFO generally results in the lowest inventory figure on the statement of financial position as it assumes that the first items purchased are also the first ones sold, leading to the assumption that the remaining items in inventory are the most recent and therefore at a higher cost.

In a Period of Declining Prices, Which of the Following