Which of the Following Is True Concerning Inventory Cost Flow

question 58

Multiple Choice

Which of the following is true concerning inventory cost flow assumptions?

• A)LIFO produces higher net income than FIFO in a period of rising costs.
• B)FIFO is an income statement focus.
• C)LIFO is a balance sheet focus.
• D)None of the other answers are true.

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Definitions:

Marginal Cost

The cost associated with producing one additional unit of output, focusing on how total production costs change with production volume adjustments.

Carbon Tax

A financial charge imposed on greenhouse gas emissions, aimed at reducing carbon dioxide emissions and combating climate change.

Aggregate Demand

The total demand for all goods and services within an economy at a given overall price level and in a given time period.

Pollution Tax

A tax imposed by governments on emissions generated by businesses and industries, aimed at reducing environmental damage.