Which inventory costing method results in the lowest income tax expense during a period of decreasing purchase prices?

Name: Which inventory costing method results in the lowest income tax expense during a period of decreasing purchase prices?
Brand: Quizplus
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Question

Quizplus · Accepted Answer

During a period of decreasing purchase prices, FIFO (First-In, First-Out) results in the lowest income tax expense because it matches older, higher-cost inventory with current sales, leading to a lower taxable income.

Which Inventory Costing Method Results in the Lowest Income Tax