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Basic Question 9 of 10
During periods of sustained rising prices, how will the liquidation of early LIFO layers affect a company's cost of goods sold, net income, and income tax liability, respectively?
B. decrease; decrease; increase
C. decrease; increase; increase
A. increase; increase; increase
B. decrease; decrease; increase
C. decrease; increase; increase
User Contributed Comments 1
| User | Comment |
|---|---|
| Antoinepo | Key word : Liquidiation. Since it affect older inventory , their cost is lower then the new one which lowers the average cost and lower COGS. |
Your review questions and global ranking system were so helpful.
Lina
Learning Outcome Statements
describe the presentation and disclosures relating to inventories and explain issues that analysts should consider when examining a company's inventory disclosures and other sources of information
CFA® 2024 Level I Curriculum, Volume 2, Module 6.