Which of the following inventory method will give the highest ending inventory in a period of rising prices?
A)FIFO
B)LIFO
C)Specific Identification Method
D)Weighted Average Cost

Question

Quizplus · Accepted Answer

FIFO method assumes that the first items purchased are the first ones sold, hence the last ones remaining in inventory at the end of the period are the most recently purchased items, which are valued at the current, higher prices. This results in a higher ending inventory value compared to other methods in a period of rising prices.

Which of the Following Inventory Method Will Give the Highest