In periods with decreasing prices and increasing quantities of inventories, which of the following relationships among inventory valuation methods is generally correct?

• LIFO has a higher inventory balance and a higher net income than FIFO.

• FIFO has a higher inventory balance and a lower net income than LIFO.

• LIFO has a lower inventory balance and a lower net income than FIFO.

• FIFO has a higher inventory balance and a higher net income than LIFO.