The primary reason for the popularity of LIFO is that it:
A) Provides better matching of physical flow and cost flow.
B) Saves income taxes currently.
C) Simplifies recordkeeping.
D) Provides a permanent reduction of income taxes.

Question

Quizplus · Accepted Answer

LIFO saves income taxes currently by reporting the highest cost of goods sold and therefore, the lowest ending inventory value, resulting in lower taxable income.

The Primary Reason for the Popularity of LIFO Is That