Which of the Following Is Not Correct Regarding Inventory Procedures

question 102

Multiple Choice

Which of the following is not correct regarding inventory procedures reported in an interim financial statement?

• A) LIFO liquidations a company expects to be replaced by year-end should be recorded in cost of goods sold, quantified at expected replacement cost rather than original LIFO cost.
• B) Lower-of-cost-or-net realizable value adjustments are not made for the interim period if they are expected to reverse by the end of the year.
• C) Variances in a standard costing system are reported at the end of the interim period unless they are expected to be absorbed by year-end.
• D) FIFO is remeasured using the LIFO method in an interim financial statement.
• E) LIFO liquidations not expected to be replaced by the end of the year are reflected in cost of goods sold at original LIFO cost.

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