In periods of rising prices, which inventory method yields the highest gross profit?
ZTBL OG III Past Papers and Syllabus / All — Multiple-choice practice
بڑھتی ہوئی قیمتوں کے ادوار میں، کون سا انوینٹری طریقہ سب سے زیادہ مجموعی منافع دیتا ہے؟
- A. Specific identification
- B. Average cost
- C. LIFO
- D. FIFO
Correct answer
FIFO
Explanation
Explanation In periods of rising prices, FIFO (First-In, First-Out) yields the highest gross profit because: Older, lower-cost inventory is sold first Cost of goods sold is lower Gross profit is higher
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