In a period of rising prices, which of the following inventory methods generally results in the lowest net income figure?
A) Average cost method
B) LIFO method
C) FIFO method
D) Need more information to answer

Question

Quizplus · Accepted Answer

LIFO (Last-In, First-Out) method results in the lowest net income figure in a period of rising prices because it assumes that the most recently purchased inventory is sold first. As a result, the cost of goods sold is higher, which reduces net income.

In a Period of Rising Prices, Which of the Following