All of the Following Statements Are True Regarding the LIFO

question 81

Multiple Choice

All of the following statements are true regarding the LIFO reserve except:

• A)Companies using LIFO are required to report the LIFO reserve.
• B)The equation (LIFO inventory - LIFO reserve = FIFO inventory) adjusts the inventory balance from LIFO to FIFO.
• C)The financial statement differences of using LIFO normally increase the longer a company uses LIFO.
• D)Current ratios and the inventory turnover can be significantly affected if a company has material LIFO reserves.

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Definitions:

Acceptance

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Manipulation

The act of controlling or influencing a person or situation cunningly or unfairly.

Endorphins

Neurotransmitters produced in the brain that act as natural painkillers and are also associated with feelings of pleasure and euphoria.

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Positive effects or improvements to the body’s health and functioning resulting from physical activity, proper nutrition, or other health behaviors.