In a Period of Declining Prices,which of the Following Inventory

question 103

Multiple Choice

In a period of declining prices,which of the following inventory methods generally results in the lowest balance sheet figure for inventory?

• A)LIFO
• B)Cannot tell without more information
• C)FIFO
• D)Average-cost

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Definitions:

Disbursements

The act of paying out or distributing money, often by a business for various expenses.

Equipment Account

An account that tracks the cost of equipment a company owns, minus any accumulated depreciation.

Liability Account

An account that records obligations or amounts owed to others that will require a future outflow of resources.

Liabilities

Financial obligations or debts owed by a business to others, which must be settled over time through the transfer of economic benefits including money, goods, or services.