When costs regularly , FIFO gives the highest cost of goods sold yielding the lowest gross profit and income.

When costs are regularly increasing, the First-In, First-Out (FIFO) method of inventory valuation will result in the highest cost of goods sold (COGS), thus yielding the lowest gross profit and net income. Here's why:

1. FIFO assumes that the first goods purchased (the oldest inventory) are sold first. Therefore, during periods of rising costs, the cost of the older, cheaper goods is recorded first in the COGS.

2. As a result, the remaining inventory is valued at the higher, more recent cost. This means that the cost of the newer, more expensive goods is recorded later in the COGS.

3. Since COGS is subtracted from sales to calculate gross profit, a higher COGS (from selling the cheaper goods first) will result in a lower gross profit.

4. Similarly, since gross profit is used to calculate net income (by subtracting operating expenses), a lower gross profit will also result in a lower net income.

Therefore, when costs are regularly increasing, using the FIFO method will result in the highest COGS and the lowest gross profit and net income.