Generally,which inventory costing method approximates most closely the current cost for each of the following?
A)LIFO for cost of goods sold,FIFO for ending inventory
B)LIFO for cost of goods sold and ending inventory
C)FIFO for cost of goods sold and ending inventory
D)FIFO for cost of goods sold,LIFO for ending inventory

Question

Quizplus · Accepted Answer

LIFO (Last In, First Out) for cost of goods sold approximates most closely the current cost because the last items purchased (which are likely at or near current prices) are the first to be sold. FIFO (First In, First Out) for ending inventory approximates most closely the current cost because the items remaining in inventory are the most recently purchased, reflecting near-current prices.

Generally,which Inventory Costing Method Approximates Most Closely the Current Cost