Which of the Following Inventory Method Will Give the Highest

question 87

Multiple Choice

Which of the following inventory method will give the highest net earnings in a period of falling prices?

• A)FIFO
• B)LIFO
• C)Specific Identification Method
• D)Weighted Average Cost

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Definitions:

Accrual Accounting

A method of accounting that records revenues and expenses when they are incurred, regardless of when cash transactions occur.

Economic Performance

A measure of how well an entity manages its resources to produce goods and services, often evaluated through factors like GDP growth, employment levels, and productivity.

Earnings Process

The series of steps undertaken by a company to report income from its operations, culminating in the publication of financial statements.

Net Asset Value

Net Asset Value (NAV) is the total value of a fund's assets minus its liabilities, often used to price shares of mutual funds and ETFs.