Asked by Katherine Roman on May 07, 2024
Verified
Under GAAP companies can choose which inventory system? LIFO ‾ FIFO ‾\begin{array} { l l l } & \underline{ \text { LIFO }} & \underline{ \text { FIFO }} \\\end{array} LIFO FIFO
A) Yes No \begin{array} { l l l } &\text { Yes } & &\text { No } \\\end{array} Yes No
B) Yes Yes \begin{array} { l l l } &\text { Yes } && \text { Yes } \\\end{array} Yes Yes
C) No Yes \begin{array} { l l l }& \text { No } && \text { Yes } \\\end{array} No Yes
D) No No \begin{array} { l l l } &\text { No } && \text { No }\end{array} No No
LIFO
An inventory valuation method standing for Last-In, First-Out, where the most recently acquired items are assumed to be sold or used first.
FIFO
FIFO (First In, First Out) is an inventory valuation method where the oldest inventory items are recorded as sold first.
- Comprehend the consequences of employing Last-In, First-Out (LIFO) and First-In, First-Out (FIFO) cost flow assumptions in accordance with Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS).
Verified Answer
MP
Learning Objectives
- Comprehend the consequences of employing Last-In, First-Out (LIFO) and First-In, First-Out (FIFO) cost flow assumptions in accordance with Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS).