Accounting Procedures Allow a Business to Evaluate Its Inventory Costs

question 79

Multiple Choice

Accounting procedures allow a business to evaluate its inventory costs based on two methods: LIFO (Last In First Out) or FIFO (First In First Out) . A manufacturer evaluated its finished goods inventory (in $000s) for five products with the LIFO and FIFO methods. To analyze the difference, they computed (FIFO - LIFO) for each product. Based on the following results, does the LIFO method result in a lower cost of inventory than the FIFO method? This example is what type of test?

• A)A one-sample test of means.
• B)A two-sample test of means.
• C)A paired t-test.
• D)A test of proportions.

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