Summary of FIFO, LIFO and WAC The ending inventory is valued at the highest amount on the balance sheet. On the other hand, LIFO produces the highest cost of goods sold and thus a lower gross profit. The balance sheet sees the lowest ending inventory value.

Which inventory costing method assigns the newest most recent costs incurred during the period to ending inventory?

LIFO
The LIFO (last-in, first-out) method of inventory costing assumes that the costs of the most recent purchases are the first costs charged to cost of goods sold when the company actually sells the goods.

Which costing method gives the highest ending inventory the highest cost of goods sold select a method costing method gives the highest ending inventory select a method method will produce the highest cost of goods sold?

FIFO gives the highest ending inventory. LIFO gives the highest cost of goods sold.

Which inventory method is more close to actual costs?

LIFO gives the most realistic net income value because it matches the most current costs to the most current revenues. Since costs normally rise over time, LIFOs can result in the lowest net income and taxes.

Which inventory method produces the lowest cost of goods sold?

FIFO
About Costing Methods First-in, first-out, or FIFO, applies the earliest costs first. In rising markets, FIFO yields the lowest cost of goods sold and the highest taxable income. If you sell one-of-a-kind items like custom jewelry, you might prefer the specific identification method.

What accounts are closed at the end of the year using the perpetual inventory system?

At the end of the year, only temporary accounts are closed to the permanent accounts in the balance sheet for the new year balances to flow into them. The merchandise inventory account, the accounts receivable account, and the accounts payable account are all the items of the balance sheet and are not closed.

Which of the three assumptions will give you the highest ending inventory in period of rising prices?

fifo method
In periods of rising prices, the fifo method yields the highest amount for ending inventory, the lowest cost of merchandise sold, and the highest net income.