An Entity Changed from the FIFO to the LIFO Cost

question 36

Multiple Choice

An entity changed from the FIFO to the LIFO cost flow assumption for inventories.Assuming that inventory and sales remain constant over time,and that prices are rising,how would the current ratio be changed as a result of converting from FIFO to LIFO?

• A) The current ratio did not change.
• B) The current ratio increased.
• C) The current ratio decreased.
• D) The effect on the current ratio cannot be determined from the information given.

Recognize the different types of probabilities and their application in decision-making contexts.

Distinguish between thinking and intuitive styles of information processing.

Understand the impact of presentation and framing on decision-making.

Differentiate between risk, certainty, and uncertainty in decision scenarios.

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