In a time of rising prices, which inventory valuation method will report higher cost of goods sold?

Question

In a time of rising prices, which inventory valuation method will report higher cost of goods sold?
🧐 Not the exact question you are looking for?Go ask a question

Solution 1

In a time of rising prices, the inventory valuation method that will report a higher cost of goods sold (COGS) is the Last-In, First-Out (LIFO) method.

Here's why:

  1. The LIFO method assumes that the last items added to the inventory are the first ones to be sold.

  2. In a period of rising price Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study prob

Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study problem.
Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study problem.
Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study problem.
Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solv

This problem has been solved

Similar Questions

In a time of rising prices, which inventory valuation method will report higher cost of goods sold?

Which method of inventory valuation will result in a higher profit in a rising price situation?

Analyse one reason why branded goods are often sold at higher prices than similar non-branded goods

Analyse one reason why branded goods are often sold at higher prices than similar non-branded goods.

Explain the components for determining the cost of goods sold for a merchandising concern.(5 marks)

1/3