LIFO was designed fo protect cash flow in industries where prices increases rapidly. It has been used for both tax and financial statments reporting since the 1930s. The higher costs of good somd under LIFO in these curcumstances results in lower reported profit fhan under FIFO. In the 2012 budget, President Obama has threatened to repeal LIFO. If Exxons uses FIFO for its inventoru valuation, calculate the cost of ending inventory and costs of goods sold if ending inventory us 100 barrels of crude oil.

LIFO was designed to protect cash flow in industries where prices increase rapidly. It has been used for both tax and financial statement reporting since the 1930s. The higher cost of goods sold under LIFO in these circumstances results in lower reported profit than under FIFO. In the 2012 budget, President Obama has threatened to repeal LIFO. If Exxon uses FIFO for its inventory valuation, calculate the cost of ending inventory and cost of goods sold if ending inventory is 100 barrels of crude oil