Which of the Following Is Not an Advantage of LIFO

question 81

Multiple Choice

Which of the following is not an advantage of LIFO over FIFO?

• A)lower income taxes
• B)better inventory figure on balance sheet
• C)better matching of revenues and costs on the income statement
• D)cost of goods sold better approximates current replacement cost

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Definitions:

AGI

Adjusted Gross Income (AGI) is a measure of income calculated from your gross income and used to determine how much of your income is taxable.

Depreciation

The accounting process of allocating the cost of a tangible or physical asset over its useful life, used to represent wear and tear or obsolescence.

Net Income

The amount of money remaining after all operating expenses, taxes, and deductions are taken out from total revenue.

Rental Property

Real estate property that is leased or rented to tenants, generating rental income for the owner.