Which of the Following Statements Best Describes How Management Selects

question 76

Multiple Choice

Which of the following statements best describes how management selects an inventory valuation method?

• A)If a company generally sells its oldest inventory first,it must use the FIFO inventory valuation method.
• B)If a company generally sells its oldest inventory first,it must use the LIFO inventory valuation method.
• C)If a company generally sells its newest inventory first,it must use the FIFO inventory valuation method.
• D)If a company sometimes sells its newest inventory and sometimes sells its oldest inventory,then it must use the weighted average inventory valuation method.
• E)A company may choose any inventory valuation method even if it is contradictory to the physical flow of inventory.