Which of the following statements is incorrect when inventory unit costs are increasing?
A)LIFO's cost of goods sold will be the largest among the inventory costing methods.
B)LIFO's income tax will be the lowest among the inventory costing methods.
C)Ending inventory using the average cost method will be larger than the ending inventory when the LIFO method is used.
D)Cost of goods sold using the average cost method will be less than cost of goods sold when the FIFO method is useD.FIFO has the lowest cost of goods sold during a period of increasing unit costs.

Question

Quizplus · Accepted Answer

When inventory unit costs are increasing, the FIFO method will result in the lowest cost of goods sold because it assigns the oldest costs to goods sold first. Therefore, statement D is incorrect. Statements A, B, and C are correct.

Which of the Following Statements Is Incorrect When Inventory Unit