__________ is a false statement.
A)During periods of inflation, LIFO makes the balance sheet less representative of the actual inventory values than if FIFO were used
B)During periods of inflation, FIFO makes the balance sheet less representative of actual inventory values than if LIFO were used
C)During periods of inflation, LIFO overstates earnings relative to FIFO
D)B and C
E)none of the above.

Question

Quizplus · Accepted Answer

During periods of inflation, FIFO, not LIFO, makes the balance sheet less representative of actual inventory values because FIFO uses older, lower costs. Also, LIFO understates earnings relative to FIFO during inflation because it uses newer, higher costs.

__________ Is a False Statement