Problem

Effect of inventory cost flow assumption on financial statementsRequiredFor each of the fo...

Effect of inventory cost flow assumption on financial statementsRequired

For each of the following situations, indicate whether FIFO, LIFO, or weighted average applies.

a.In a period of rising prices, net income would be highest.


b.In a period of rising prices, cost of goods sold would be highest.


c.In a period of rising prices, ending inventory would be highest.


d.In a period of falling prices, net income would be highest.


e.In a period of falling prices, the unit cost of goods would be the same for ending inventory and cost of goods sold.

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