76. When a company uses LIFO for external reporting purposes and FIFO for internal reporting purposes, an Allowance to Reduce Inventory to LIFO account is used. This account should be reported a. on the income statement in the Other Revenues and Gains section. b. on the income statement in the Cost of Goods Sold section. c. on the income statement in the Other Expenses and Losses section. d. on the balance sheet in the Current Assets section. 77. What happens when inventory in base year dollars decreases?
Valuation of Inventories: A Cost-Basis Approach 8 - 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? S80. Which of the following statements is not true as it relates to the dollar-value LIFO inven-tory method? a. It is easier to erode LIFO layers using dollar-value LIFO techniques than it is with specific goods pooled LIFO. b. Under the dollar-value LIFO method, it is possible to have the entire inventory in only one pool. c. Several pools are commonly employed in using the dollar-value LIFO inventory method. d. Under dollar-value LIFO, increases and decreases in a pool are determined and measured in terms of total dollar value, not physical quantity. S81. Which of the following is not considered an advantage of LIFO when prices are rising? 82. Which of the following is true regarding the use of LIFO for inventory valuation?
- Spring '10
- Thirteenth Edition