Jacob Corporation Decides to Use the LIFO Method of Inventory

question 55

Multiple Choice

Jacob Corporation decides to use the LIFO method of inventory valuation.Which of the following is true?

• A)Jacob can change to FIFO whenever it wishes.
• B)Jacob must use LIFO in its financial statements.
• C)Jacob will have higher taxable income if prices are rising.
• D)Jacob can include FIFO information on the face of the income statements.

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Definitions:

Work Cell

A production setup designed around a specific set of processes or jobs that are physically grouped together, often in a manufacturing setting, to improve efficiency and flow.

Assembly Line Workstation

refers to a specific work area within an assembly line designed for the completion of a particular task or the assembly of a particular part of a product.

Product-oriented Layout

A facility layout design where resources and equipment are arranged according to the sequence of operations required to produce a specific product efficiently.

Equipment Utilization

the extent to which machinery and equipment are employed in production, usually measured as a percentage of available time used.