For each of the following situations, indicate whether FIFO, LIFO, or weighted average applies.

Question

a. In a period of rising prices, net income would be highest.
b. In a period of rising prices, cost of goods sold would be highest.
c. In a period or rising prices, ending inventory would be highest.
d. Ina period of falling prices, net income would be highest.
e. In a period of falling prices, the unit cost of goods would be the same for ending inventory and cost of goods sold.

Answer 1

1.b