Replenish, Inc. develops and produces sports drinks for sale throughout the United States and Europe. The International Accounting Standards Board (IASB) prohibits Replenish, Inc. from using which of the following cost flow assumptions for its inventory?
A) LIFO (last-in, first-out).
B) Specific identification.
C) Weighted-average.
D) The IASB allows any of these cost flow assumptions as long as the company uses it consistently.

Question

Quizplus · Accepted Answer

The IASB prohibits the use of the LIFO cost flow assumption for inventory valuation. Therefore, Replenish, Inc. cannot use LIFO for its inventory.