During periods of inflation, the use of FIFO (rather than LIFO) as the method of accounting for inventories causes
A)higher reported sales.
B)higher incomes taxes.
C)lower ending inventory.
D)higher incomes taxes and lower ending inventory.
E)None of the options

Question

Quizplus · Accepted Answer

In inflationary periods, the use of FIFO causes overstated earnings, which result in higher taxes.

During Periods of Inflation, the Use of FIFO (Rather Than