In a Period of Falling Prices, Which Inventory Method Would

question 100

Multiple Choice

In a period of falling prices, which inventory method would result in the lowest tax burden?

• A) Average-cost.
• B) FIFO.
• C) No difference.
• D) Cannot be determined.

---

Definitions:

Minimizing Risk

Strategies or actions taken to reduce the probability and/or impact of harmful outcomes in decision-making or processes.

Stocks

Stocks represent shares of ownership in a company, providing investors with a claim on the company's assets and earnings, and are traded on stock exchanges.

Choose

A term often associated with selecting options or making decisions from a set of alternatives.

Risk

The potential for loss or an undesirable outcome, often assessed in the context of investments or decision-making.