See-Saw Ltd uses moving weighted average for its inventory,which is valued at $276 000.It is considering a change to FIFO,which would decrease the valuation to $245 000.Which of the following would be decreased by the change?

Question

Quizplus · Accepted Answer

Switching from moving weighted average to FIFO would decrease the inventory valuation, which would increase the cost of goods sold and subsequently decrease the net profit.

See-Saw Ltd Uses Moving Weighted Average for Its Inventory,which Is