The LIFO Conformity Rule states that if LIFO is used for:
A) One class of inventory, it must be used for all classes of inventory.
B) Tax purposes, it must be used for financial reporting.
C) One company in an affiliated group, it must be used by all companies in an affiliated group.
D) Domestic companies, it must be used by foreign partners.

Question

Quizplus · Accepted Answer

The LIFO (Last In, First Out) Conformity Rule requires that if a company uses the LIFO method for tax purposes, it must also use LIFO for financial reporting purposes to ensure consistency in reported income.

The LIFO Conformity Rule States That If LIFO Is Used