With Respect to LIFO, Which of the Following Is Incorrect

question 33

Multiple Choice

With respect to LIFO, which of the following is incorrect?

• A)If a company uses LIFO for tax purposes, it must use it for GAAP purposes.
• B)If the LIFO reserve increases in a given year, cost of goods sold under the LIFO inventory costing is higher than it would have been if FIFO had been used for that year.
• C)LIFO results in better matching on the income statement than FIFO.
• D)LIFO results in inventory levels on the balance sheet that are closer to current cost than FIFO.

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Definitions:

Ependymal Cells

Glial cells that line the ventricles in the brain and the central canal of the spinal cord, involved in the production of cerebrospinal fluid.

Reaction Time

The duration it takes for an individual to respond to a stimulus.

Central Nervous System

The complex of nerve tissues that controls the activities of the body, comprising the brain and spinal cord.

Spinal Cord

A long, thin bundle of nervous tissue that extends from the brain down the vertebral column, transmitting nerve impulses to and from the brain.