A company should determine cost for inventory purposes by the Inventory Cost Flow Method most clearly reflecting its periodic income. Required: (1)Explain the fundamental cost flow assumptions of the average cost. FIFO and LIFO inventory cost flow methods.(2) Discuss the reasons a company uses LIFO in an inflationary economy.(3) Where there is evidence that the utility of goods, in their disposal in the ordinary course of business will be less than cost . Explain the proper accounting treatment and under what concept that treatment is justified