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3 years ago

If a company uses LIFO, a LIFO liquidation causes a company's income taxes to increase:_______

Business

1 answer:

olasank [31]3 years ago

4 0

Answer: a. When inventory purchase costs are rising.

Explanation:

Last In First Out is an inventory stock valuation method where newer inventory is sold first and older inventory are sold last.

When a LIFO liquidation occurs, it means that the company has sold off its new stock and are now selling the older one.

This will lead them to have a lower cost of goods sold as the older stock is usually cheaper. If Inventory purchase costs are increasing in the market, then sales prices will have to increase as well. The company will sell at this new price but will still have that lower cost of goods sold.

This means that they would have more profits as a result which will lead to more taxes being charged on them.

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1 year ago

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3 years ago

If consideration is received before a contract is identified and the consideration is nonrefundable, revenue may be recognized i

Studentka2010 [4]

Answer: Any of these answer choice is correct.

Explanation:

You didn't put the options to the question. The options are:

• There is no remaining obligation to transactions goods.

• The contract has been terminated.

• Goods have been delivered.

• Any of these answer choice is correct.

When consideration has been received before a contract is identified and the consideration is nonrefundable, then the revenue may be recognized when:

• There is no remaining obligation to transactions goods.

• The contract has been terminated.

• Goods have been delivered

Therefore, the correct option is any of the answer choice is correct.

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3 years ago