Which inventory cost flow assumption generally results in the highest reported amount for cost of goods sold when inventory costs are falling?

Weighted-average cost.

LIFO.

Straight-line.

FIFO.

The FIFO inventory system assumes that it's the first purchased inventory that is sold. So in a period of falling prices, the FIFO inventory system results in reporting the highest cost of good sold.

For example, a business has inventory on the 1st of February that costs $30 for 10 goods, on the 10th, they purchased an extra 10 goods that costs $20. If 10 goods were sold, the FIFO inventory system would record the cost of goods sold as $30. If the LIFO inventory system is used, cost of goods sold would be $20. If the weighted average was used it would be $25.

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Which inventory cost flow assumption generally results in the highest reported amount for cost of goods sold when inventory costs are falling? Weighted-average cost. LIFO. Straight-line. FIFO.

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Which inventory cost flow assumption generally results in the highest reported amount for cost of goods sold when inventory costs are falling?

Weighted-average cost.

LIFO.

Straight-line.

FIFO.