Which of the following is not correct regarding inventory procedures reported in an interim financial statement?
A) LIFO liquidations expected to be replaced by the end of the year are accounted for in cost of goods sold at expected replacement cost rather than original LIFO cost.
B) Lower-of-cost-or-market adjustments are not made for the interim period if they are expected to reverse by the end of the year.
C) Variances in a standard costing system are reported at the end of the interim period unless they are expected to be absorbed by year-end.
D) FIFO is remeasured using the LIFO method in an interim financial statement.
E) LIFO liquidations not expected to be replaced by the end of the year are reflected in cost of goods sold at original LIFO cost.

Question

Quizplus · Accepted Answer

FIFO and LIFO are both inventory valuation methods, and remeasuring one using the other method would not be an appropriate inventory procedure in an interim financial statement. Therefore, choice D is not correct regarding inventory procedures reported in an interim financial statement. The other choices (A, B, C, and E) reflect correct inventory procedures for interim financial statements.

Which of the Following Is Not Correct Regarding Inventory Procedures