Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

Exercise 87

Identify the inventory costing method best described by each of the following separate statements. Assume
a period of increasing costs.
_________ 1. Yields a balance sheet inventory amount often markedly less than its replacement cost.
_________ 2. Results in a balance sheet inventory amount approximating replacement cost.
_________ 3. Provides a tax advantage (deferral) to a corporation when costs are rising.
_________ 4. Recognizes (matches) recent costs against net sales.
_________ 5. The preferred method when each unit of product has unique features that markedly affect cost.