Question 8 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 $ 400.000 $ 300,000 12/31/2021 480,000 350,000 Which of the following statements is correct? A)The adjusting entry should be a debit to the LIFO Reserve by $130,000 on 12/31/2021. B)The adjusting entry should be a credit to LIFO reserve for $30,000 on 12/31/2021 C)Cost of goods sold is higher under LIFO than under FIFO by $130,000 in 2021. D) The adjusting entry should be a debit to the LIFO Reserve by $100,000 on 12/31/2020 OB OD * 0 % 2 7 6 5 4 3 1 2 Y T R E W Q D F S Question 8 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 $ 400.000 $ 300,000 12/31/2021 480,000 350,000 Which of the following statements is correct? A)The adjusting entry should be a debit to the LIFO Reserve by $130,000 on 12/31/2021. B)The adjusting entry should be a credit to LIFO reserve for $30,000 on 12/31/2021 C)Cost of goods sold is higher under LIFO than under FIFO by $130,000 in 2021. D) The adjusting entry should be a debit to the LIFO Reserve by $100,000 on 12/31/2020 OB OD * 0 % 2 7 6 5 4 3 1 2 Y T R E W Q D F S