fifo

问题如下：

Q. If the trend noted in the ICCO report continues and Century Chocolate plans to maintain constant or increasing inventory quantities, the most likely impact on Century Chocolate’s financial statements related to its raw materials inventory will be:

选项：

A.a cost of sales that more closely reflects current replacement values. B.a higher allocation of the total cost of goods available for sale to cost of sales. C.a higher allocation of the total cost of goods available for sale to ending inventory.

解释：

C is correct. Using the FIFO method to value inventories when prices are rising will allocate more of the cost of goods available for sale to ending inventories (the most recent purchases, which are at higher costs, are assumed to remain in inventory) and less to cost of sales (the oldest purchases, which are at lower costs, are assumed to be sold first).