According to generally accepted accounting principles,a firm must use the inventory valuation method that most accurately reflects the actual movement of goods through its inventory.

Question

Quizplus · Accepted Answer

Generally accepted accounting principles (GAAP) allow firms to choose from several inventory valuation methods (e.g., FIFO, LIFO, weighted average) based on their financial reporting needs, not necessarily the actual movement of goods.

According to Generally Accepted Accounting Principles,a Firm Must Use the Inventory