If a company chooses the LIFO method of inventory valuation, which inventory will appear as ending inventory on the balance sheet?
A) The last inventory purchased.
B) The first inventory purchased.
C) An average of all inventory purchased.
D) The actual inventory which has not been sold.

Question

Quizplus · Accepted Answer

Under the Last-In, First-Out (LIFO) method of inventory valuation, the most recently purchased items are assumed to be sold first, leaving the oldest inventory (the first inventory purchased) to appear as ending inventory on the balance sheet.

If a Company Chooses the LIFO Method of Inventory Valuation