Evaluation of Inventory Costing Methods Write the letter of the method that is most applicable to each statement.

a. Specific identification

b. Average cost

c. First-in, first-out (FIFO)

d. Last-in, first-out (LIFO)

1. Is the most realistic ending inventory 2. Results in cost of goods sold being closest to current product costs 3. Results in highest income during periods of inflation 4. Results in highest ending inventory during periods of inflation 5. Smooths out costs during periods of inflation 6. Is not practical for most businesses 7. Puts more weight on the cost of the larger number of units purchased 8. Is an assumption that most closely reflects the physical flow of goods for most businesses