During periods when inventory costs are rising,ending inventory will most likely be:

Question

Quizplus · Accepted Answer

During periods of rising inventory costs, LIFO (last-in, first-out) will result in higher cost of goods sold and lower ending inventory since the most recently purchased (and higher priced) items are assumed to be sold first. On the other hand, FIFO (first-in, first-out) assumes that the oldest (and lower priced) items are sold first, resulting in lower cost of goods sold and higher ending inventory. Therefore, choice D - Greater under FIFO than LIFO - is the best choice.

During Periods When Inventory Costs Are Rising,ending Inventory Will Most