Ask Question
26 June, 09:17

Summer, Inc. has been in business for 20 years. During that time the company has consistently used the LIFO inventory costing method. Because of inflation, prices for merchandise have increased consistently over the 20 years. The company has maintained the same inventory quantities over the 20-year period. Which one of the following statements is true? a. Summer, Inc.'s total net income for the past 20 years is greater than it would have reported using another inventory method. b. Summer, Inc. will have paid more income taxes over the past 20 years than it would have if it had used the FIFO method. c. Summer will have to continue using the LIFO method indefinitely because of generally accepted accounting principles and federal income tax rules. d. The ending inventory figure reported on the balance sheet may be significantly lower than its current value.

+1
Answers (1)
  1. 26 June, 09:24
    0
    c. Summer will have to continue using the LIFO method indefinitely because of generally accepted accounting principles and federal income tax rules.

    Explanation:

    For order to store an accounting amount, the last in, first out (LIFO) approach is used. The LIFO strategy means that the last product of the store that is purchased will be the first product sold.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Summer, Inc. has been in business for 20 years. During that time the company has consistently used the LIFO inventory costing method. ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers