A company has the following information related to its ending inventory: Assume 2020 is its first year of operation. The company uses LIFO for external reporting purpose. FIFO LIFO 12/31/2020 $ 35,000 $ 30,000 12/31/2021 40,000 35,000 Which of the following statements is correct? A)The adjusting entry for the year ending 2020 should be a debit to the LIFO Reserve by $5,000 on 12/31/2021. B)No adjusting entry to LIFO reserve is necessary on 12/31/2021 C)Cost of goods sold is higher under LIFO than under FIFO in 2021. D) The adjusting entry should be a credit to the LIFO Reserve by $10,000 on 12/31/2021