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Natasha_Volkova [10]
3 years ago
7

If inventory is being valued at cost and the price level is steadily rising, which of the three costing methods (FIFO, LIFO, wei

ghted-average) will yield the lowest annual income tax expense?
Business
1 answer:
Nat2105 [25]3 years ago
5 0

Answer:

LIFO                

Explanation:

It will be the one that give higher Cost of goods sold. We also know that:

Cost of goods sold = Opening Inventory + Inventory Purchases - Closing Inventory

So this means the lower the closing inventory the higher the cost of goods sold and in time of price increases it will be more appropriate to use LIFO method which will reduce the Closing Inventory and this will increase the cost of goods sold and thus decrease in profit. This reduced profit means that the tax expense will also be lower in value.

Similarly the second attractive option will be the Weighted Average and the least attractive option would be FIFO costing method.

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Answer:

Option D. Prepare a trial balance, prepare adjusting entries, prepare financial statements

Explanation:

The accounting cycle sequence is given as under:

  1. Analyzing the business
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  3. Post to Ledger Accounts
  4. Prepare a Trial Balance
  5. Posting adjusting entries and Preparing an adjusted trial balance
  6. Preparing the financial statements
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  8. Prepare a post closing trial balance and financial statement

So we can see that the three steps highlighted above are the sequence shown in the option D. Hence option D is correct.

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Answer:

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Explanation:

Managerial Accounting is<em> internally-based accounting</em> that helps managers measure the results of their decisions. This is in contrast to financial accounting which emphasizes more general, higher-level financial results. One common managerial accounting tool is determining the <em>profit margin in each of the company's products</em>. This information helps managers set product prices and ensure that they are making appropriate profit margins.

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How is creative thinking similar to a child’s thinking? A. Neither process restricts itself to logical solutions. B. Both though
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