During a period of increasing cost prices, which inventory costing method will yield the lowest cost of goods sold?
A) Any method in which the company uses a periodic inventory system
B) Weighted Average Cost
C) LIFO
D) FIFO

Question

Quizplus · Accepted Answer

FIFO (First-In, First-Out) assumes that the oldest inventory items are sold first. During periods of rising costs, the older, cheaper costs are matched against revenues, resulting in a lower cost of goods sold compared to other methods.

During a Period of Increasing Cost Prices, Which Inventory Costing