Which Inventory Costing Method Results in the Lowest Income Tax

question 29

Multiple Choice

Which inventory costing method results in the lowest income tax expense during a period of decreasing prices?

• A)FIFO
• B)LIFO
• C)Specific identification
• D)Weighted average cost

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Definitions:

Jejunum

Second portion of the small intestine; located between the duodenum and the ileum.

Hepatocytes

The main functional cells of the liver, responsible for a wide range of metabolic, detoxification, and synthetic functions.

Synthesize Bile

The process of producing bile, a digestive fluid created in the liver and vital for the digestion and absorption of lipids in the small intestine.

Hydrochloric Acid

A strong, corrosive acid that is a major component of gastric acid, aiding in digestion and absorption in the stomach.