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FIFO VS. LIFO (my answers are in bold) FIFO results in OLDER (older/current) COGS and CURRENT...

FIFO VS. LIFO (my answers are in bold)

FIFO results in OLDER (older/current) COGS and CURRENT (older/current) costs in Ending Inventory

LIFO results in REPLACEMENT (older/replacement) cost in COGS and REPLACEMENT (older/replacement) costs in Ending Inventory

Assuming increasing prices, FIFO results in HIGHEST (lowest/highest) COGS, LOWEST (lowest/highest) Net Income and HIGHEST (lowest/highest) taxes.

Assuming falling prices, LIFO results in the LOWEST (lowest/highest) asset balance (Ending Inventory).

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Answer #1

FIFO VS LIFO

FIFO results in OLDER COGS and CURRENT costs in Ending Inventory

LIFO results in REPLACEMENT cost in COGS and OLDER costs in Ending Inventory

Assuming increasing prices, FIFO results in LOWEST  COGS, HIGHEST Net Income and HIGHEST taxes.

Assuming falling prices, LIFO results in the HIGHEST asset balance (Ending Inventory).

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