Which of the Following Statements About Inventory Costing Methods Is

question 12

Multiple Choice

Which of the following statements about inventory costing methods is correct?

• A)A change in inventory method is allowed only if it improves the accuracy of the company's financial results.
• B)During a period of rising prices,LIFO results in a higher income tax expense than does FIFO.
• C)International Financial Reporting Standards (IFRS)allow the use of LIFO but not FIFO.
• D)In the U.S. ,if a company uses LIFO on the income tax return,it may use a different method for financial reporting.

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Definitions:

Conditional Sale Agreement

A contract for the sale of goods where the full price is payable in installments, and the ownership of the goods does not pass to the buyer until certain conditions, typically the payment of the final installment, are met.

Registered

Officially recorded or enrolled in a list or database by a recognized authority.

Seize

To take possession of something forcefully or by legal authority.