As a student of economics you are well aware of the inflation problem. Especially in this time since new political government came into power, inflation seems to be a persistent problem and every time everywhere. As an accountant and economist maintaining the inventory records of a merchandising firm what do you think which inventory cost flow assumption will most likely to results in the highest reported profits? The lowest taxable income? The valuation of inventory that is closest to current replacement cost? Briefly explain your answers

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A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

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A: a. b. c. d.

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A: Answer: The correct option would be option C (I, III, and IV only). Introduction: Restrictive policy…

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A: Net Realizable Value (NRV) Method: NRV method is a method of joint cost allocation which takes into…

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Q: resource cost of inflation

A: Inflation means an increase in the prices of the products thus leading to a decrease in purchasing…

Q: Which of the following criticisms does NOT apply to historical cost financial statements during a…

A: The historical cost financial statement represents the financial statement that records the assets…

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A: Lean businesses aim to: Reduce inventory levels--true

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Q: Which of the following statements is true?

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A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

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Q: 8.  Which of the following is among those listed under PAS 29 as indicators of hyper-inflation?…

A: Hi student Since there are multiple questions, we will answer only first question.

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A: FIFO First in first out method is a method of inventory accounting wherein the units of goods…

Q: In the case of decrease the operating cash cycle, which one of the following actions should be…

A: cash flow from operating activities include normal operating of firm.

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Q: answer these question in just two sentences. a..“If a firm sold some inventory on credit, its…

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.