Baker Company Has Been Using the LIFO Method of Inventory

question 72

Multiple Choice

Baker Company has been using the LIFO method of inventory valuation for 10 years, since it began operations.Its 2007 ending inventory was $40,000, but it would have been $60,000 if FIFO had been used.Thus, if FIFO had been used, Baker's income before income taxes would have been

• A)$20,000 greater over the 10-year period.
• B)$20,000 less over the 10-year period.
• C)$20,000 greater in 2007.
• D)$20,000 less in 2007.

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Definitions:

Generic ESTs

A term that could refer to generic Electronic Service Tools, which are software applications used for diagnostics and programming of electronic systems in vehicles or machinery.

Active and Historic Codes

In vehicle diagnostics, active codes indicate current issues, while historic codes refer to previously detected problems that have been resolved or cleared.

ECU or ECM

Stands for Electronic Control Unit or Engine Control Module, a type of computer in vehicles that controls engine functions to ensure optimal performance.

Counts of Resolution

A measure of the smallest movement or change in position that a sensor or device can detect.