Two Companies Report the Same Cost of Goods Available for Sale

question 11

Multiple Choice

Two companies report the same cost of goods available for sale but each employs a different inventory costing method.If the price of goods has increased during the period, then the company using

• A)LIFO will have the highest ending inventory.
• B)FIFO will have the highest cost of goods sold.
• C)FIFO will have the highest ending inventory.
• D)LIFO will have the lowest cost of goods sold.

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Definitions:

Productivity Growth

An increase in the efficiency of production, often measured by the ratio of output to inputs in the production process over time.

Produce Goods

The process of creating, manufacturing, or growing products intended for consumption or use.

Services

Intangible products such as healthcare, education, and financial consultation that are consumed by buyers in an economy.

Power Of Population

Refers to the impact that a population size and growth rate can have on resources and environmental conditions.