Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

تمرين 7

The Comfort Store sells heating oil, coal, and kerosene fuel to residential customers.eating oil is kept in large storage tanks that supply the company's fleet of delivery trucks.oal is kept in huge bins that are loaded and emptied from the top by giant scooping machines.erosene is sold "off the shelf " in five-gallon containers at the company's retail outlet.eparate inventory records are maintained for each fuel type.
a.hich of the cost flow assumptions (average-cost, FIFO, or LIFO) best describes the physical flow of:
1.he heating oil inventory Explain.
2.he coal inventory Explain.
3.he kerosene inventory Explain.
b.hich of these cost flow assumptions is likely to result in the lowest income tax liability for the company Explain.
c.xplain why management keeps separate inventory records for its heating oil, coal, and kerosene inventories.