Choose the Statement Which Is Correct

question 3

Multiple Choice

Choose the statement which is correct. Assume that inventory prices are rising.

• A)The LIFO method gives the highest closing inventory figure in the statement of financial position.
• B)The FIFO method gives the highest closing inventory figure in the statement of financial position.
• C)The FIFO method gives the lowest closing inventory figure in the statement of financial position.
• D)The LIFO method gives the lowest figure for cost of sales.

---

Definitions:

Cafeteria Department

A functional division within an organization that provides food and beverage services to employees.

Reciprocal Services Method

A cost allocation technique used in managerial accounting to allocate costs between interdependent departments by solving simultaneous equations.

Sequential Method

A cost allocation method used for assigning the costs of support departments to operating departments sequentially, in a specific order based on the level of service provided.

Algebraic Expressions

Mathematical phrases that can contain ordinary numbers, variables, and mathematical operations, but do not have an equality sign.