Which inventory method is better described as having an income statement focus and why is it considered as such?

Question

Quizplus · Accepted Answer

LIFO is considered to have an income statement focus because it assumes that the most recently incurred costs are the first ones to be recognized as expenses, resulting in higher cost of goods sold and lower net income. This method better approximates the inventory cost necessary to generate revenue, which is the main focus of the income statement.

Which Inventory Method Is Better Described as Having an Income