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25. In a period of increasing prices, which inventory flow assumption will result in the lowest amount of income tax expense? a) FIFO b) LIFO
25. In a period of increasing prices, which inventory flow assumption will result in the lowest amount of income tax expense? a) FIFO b) LIFO c) Average Cost d) Income tax expense for the period will be the same under all assumptions. A company just started business made the following four inventory purchases in June: June 1 June 10 June 15 June 28 150 units 200 units 200 units 150 units $ 750 1,200. 1,260. 990 $ 4,200. A physical count of merchandise inventory on June 30 reveals that there are 300 units on hand. 26. Using the LIFO inventory method, the value of the ending inventory on June 30 is a) $1,650. b) $1,935 c) $2,265 d) $2,550. 27. Using the FIFO inventory method, the amount allocated to cost of goods sold for June is a) $1,935 b) $1,650. c) $2,265 d) $2,250. 28. Using the average cost method, the amount allocated to the ending inventory on June 30 is a) $4,200 b) $2,400. c) $1,794 d) $1,800
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