Answered: Which of the following statements is…

Business

Accounting

Which of the following statements is true?

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter4: Gross Income: Concepts And Inclusions

Section: Chapter Questions

Problem 1DQ

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Question

38. Which of the following statements is true?
a. LIFO must be used for financial reporting if it is used for tax purposes.
b. Application of LIFO for financial reporting purposes must follow the tax laws applicable to LIFO.
c. A company may use FIFO to valuate inventory and LIFO for financial statement reporting purposes.
d. A company must use FIFO for both tax reporting and financial statement reporting.

Definition Definition Accounting practice that allows a business to determine the monetary value of any unsold inventory.

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