An inventory pricing procedure in which the oldest costs incurred rarely have an effect on the ending inventory valuation is
A) FIFO
B) LIFO
C) Conventional retail
D) Weighted average

Question

Quizplus · Accepted Answer

LIFO (Last-In, First-Out) assumes that the newest or most recently acquired inventory items are sold first, and therefore the ending inventory consists of the oldest costs. This method works well for businesses where inventory costs are steadily rising because it results in a lower taxable income by matching high-priced inventory with revenue from sales.

An Inventory Pricing Procedure in Which the Oldest Costs Incurred