Test: Test 2 Chapters 4-7 35 Which of the following statements is false regardin

Question

Test: Test 2 Chapters 4-7 35 Which of the following statements is false regarding the choice between alternative inventory costing methods? O a in terms of current costs, FFO presents a more realistic balance sheet, whereas UFO presents a more realistic income statement O b Companies sometimes choose FIFO because it presents a more realistic income statement in terms of current market values O e Each alternative methed provides for the same amount of cost of goods available for sale to be allocated between anding inventory and cost of goods sold O d Companies sometimes choose FIFO because it is easier and less expensive to implement, whereas LIFO is often chosen for the tax benefits 40 O Type here to search 9 0

Explanation / Answer

The false statement is B. that companies sometimes choose fifo because it presents more realistic ncome statement in terms of current market value.

The statement is false because  LIFO gives the most realistic net income value because it matches the most current costs to the most current revenues.

Looking forward for your upvote.

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