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Which one of the following cost-flow assumptions provides the lowest inventory value in periods of rising prices?
A) FIFO periodic
B) LIFO periodic
C) FIFO perpetual
D) moving average
LIFO Periodic
An inventory accounting method where the last items purchased are the first ones used in costing inventory, applied at the end of the accounting period.
Inventory Value
The total cost or market value of all the goods and products held by a company intended for sale in the ordinary course of business.
Rising Prices
Refers to an economic condition where the general level of prices for goods and services increases over a period of time.
- Evaluate the implications of employing different inventory appraisal methods on fiscal documentation.
- Examine and assess the benefits and drawbacks of the LIFO and FIFO methods for inventory management.
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Learning Objectives
- Evaluate the implications of employing different inventory appraisal methods on fiscal documentation.
- Examine and assess the benefits and drawbacks of the LIFO and FIFO methods for inventory management.
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