77.What happens when inventory in base year dollars decreases? a.LIFO reserve increases.b.LIFO layer is created.c.LIFO layer is liquidated.d.LIFO price index decreases.
Valuation of Inventories: A Cost-Basis Approach8 - 17 78.How might a company obtain a price index in order to apply dollar-value LIFO? 79.In the context of dollar-value LIFO, what is a LIFO layer? S 80.Which of the following statements is not true as it relates to the dollar-value LIFO inven-tory method? S 81.Which of the following is not considered an advantage of LIFO when prices are rising? a.The inventory will be overstated.b.The more recent costs are matched against current revenues.c.There will be a deferral of income tax.d.A company's future reported earnings will not be affected substantially by future price declines. 82.Which of the following is true regarding the use of LIFO for inventory valuation? 83.If inventory levels are stable or increasing, an argument which is not an advantage of the LIFO method as compared to FIFO is
8 - 18Multiple Choice Answers—ConceptualItem21.c30.c39.b48.d57.c66.b75.a22.b31.d40.b49.d58.a67.a76.d23.b32.b41.d50.a59.d68.b77.c24.a33.a42.b51.b60.b69.c78.d25.c34.d43.a52.d61.a70.d79.d26.a35.d44.a53.b62.b71.d80.a27.d36.a45.d54.d63.a72.c81.a28.b37.b46.b55.a64.b73.b82.d29.b38.c47.c56.a65.a74.c83.cSolutions to those Multiple Choice questions for which the answer is “none of these.”34.
- Spring '12
- Accounting, Thirteenth Edition