When the cost of inventory is rising, which inventory cost flow method will produce the lowest amount of cost of goods sold?
A)FIFO
B)Weighted Average.
C)All methods will produce the same amount of cost of goods sold.
D)LIFO

Question

Quizplus · Accepted Answer

When prices are rising, FIFO will produce the lowest cost of goods sold (earliest purchases) compared with LIFO which will be based on more recent, higher priced purchases. Weighted average will be somewhere in between.

When the Cost of Inventory Is Rising, Which Inventory Cost