IFRS does not allow the use of LIFO because it
A) would have to be allowed for tax reporting in each country.
B) would result in too many overstatements of income.
C) is inconsistent with any presumed physical flow of inventory.
D) would have to be the only method permitted.

Question

Quizplus · Accepted Answer

IFRS does not allow the use of LIFO (Last In, First Out) inventory accounting because it is considered inconsistent with the actual physical flow of inventory in most cases. This method does not reflect the economic reality of how inventory is typically consumed or sold, leading to potential distortions in financial reporting.

IFRS Does Not Allow the Use of LIFO Because It