On December 31, 2014, Hill Company, Which Sells Only One

Multiple Choice

On December 31, 2014, Hill Company, which sells only one product, adopted the periodic last-in, first-out method of inventory valuation. The inventory was valued at $40,000 on the December 31, 2014 balance sheet. The number of items in its inventory remained constant during 2015. The December 31, 2015 inventory valuation would be

A) less than $40,000 if prices were steadily decreasing.
B) less than $40,000 if prices were steadily increasing.
C) greater than $40,000 if prices were steadily increasing.
D) $40,000 regardless of any price changes.