Assume That Barber Co

Multiple Choice

Assume that Barber Co. uses the LIFO inventory costing method for both tax and financial reporting purposes. The balance sheet reports inventories at $297 million. Then, in its footnotes, the company reports that inventories would have been $327 million had the company used the FIFO method.
The difference between these two numbers ($30 million) is referred to as:

A) LIFO reserve
B) LIFO conformity rule
C) LIFO holding gain
D) Inventory temporary difference
E) None of the above