Which of the following inventory cost flow method reports most closely the current cost of inventory
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Show This preview shows page 1 - 2 out of 2 pages. PROBLEM 31.Which of the following inventory method reports most closely the current cost of inventory?A.FIFOB.Specific identificationC.Weighted averageD.LIFO 2. Which inventory cost flow assumption would consistently result in the highest income in a period ofsustained inflation? Get answer to your question and much more 3. In a period of falling prices, the use of which inventory cost flow method would typically results in thehighest cost of goods sold? Get answer to your question and much more 4. Which method of inventory pricing best approximates specific identification of the actual flow of costs andunits? Get answer to your question and much more 5. In a period of rising prices, the inventory cost allocation method that tends to result in the lowest reportednet income isA.LIFOB.FIFOC.Moving averageD.Weighted average Upload your study docs or become a Course Hero member to access this document End of preview. Want to read all 2 pages? Upload your study docs or become a Course Hero member to access this document Tags FIFO and LIFO accounting, current cost of inventory, following inventory method reports Recommended textbook solutionsFinancial Accounting5th EditionDavid Spiceland, Don Herrmann, Wayne Thomas 1,323 solutions Financial Accounting9th EditionFrank Hodge, Patricia A. Libby, Robert Libby 1,286 solutions Managerial Accounting15th EditionEric W. Noreen, Peter C. Brewer, Ray H Garrison 716 solutions Horngren's Cost Accounting: A Managerial Emphasis16th EditionMadhav V Rajan, Srikant M. Datar 1,008 solutions Recommended textbook solutions
Glencoe Accounting: First Year Course1st EditionGlencoe McGraw-Hill 548 solutions Financial Accounting9th EditionCharles T. Horngren 1,286 solutions Intermediate Accounting16th EditionDonald E. Kieso, Jerry J. Weygandt, Terry D. Warfield 2,307 solutions Financial Accounting4th EditionDon Herrmann, J. David Spiceland, Wayne Thomas 1,097 solutions Which inventory valuation method best matches the cost of goods sold with current replacement cost?(a) First-in, First-out (FIFO): Under FIFO, the cost of goods sold is based upon the cost of material bought earliest in the period, while the cost of inventory is based upon the cost of material bought later in the year. This results in inventory being valued close to current replacement cost.
Which method reflects the most recent costs of inventory on the balance sheet?Key Takeaways. The Last-In, First-Out (LIFO) method assumes that the last unit to arrive in inventory or more recent is sold first. The First-In, First-Out (FIFO) method assumes that the oldest unit of inventory is the sold first.
Which is better LIFO or FIFO?FIFO (first in, first out) inventory management seeks to value inventory so the business is less likely to lose money when products expire or become obsolete. LIFO (last in, first out) inventory management is better for nonperishable goods and uses current prices to calculate the cost of goods sold.
Which method of inventory costing is the best?Specific identification is the most accurate inventory accounting method. It tracks the cost of each item in your inventory and the actual price of each item that sold.
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