IFRS Does Not Allow the LIFO Inventory Method Because ________

question 125

Multiple Choice

IFRS does not allow the LIFO inventory method because ________.

• A) of the increased taxes owed under the LIFO method
• B) the majority of companies do not actually sell the oldest items first
• C) it is viewed as unrealistic and lacks representational faithfulness of inventory flows
• D) the FIFO method more accurately reflects the cost of inventory

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Definitions:

Normative

Relating to an ideal standard or model, or principles of what is considered right and acceptable behavior.

Presenters

Individuals who deliver presentations or speeches in front of an audience.

Process

A series of actions or steps taken in order to achieve a particular end.

Produce

To create, manufacture, or bring forth goods, services, or results through a process of combining or arranging resources or efforts.