What Happens When a Company Is Operating in an Inflationary

Multiple Choice

What happens when a company is operating in an inflationary environment?

A) The company's net income will be higher if it uses LIFO than if it uses FIFO.
B) The company's cost of goods sold will be lower if it uses LIFO as opposed to FIFO.
C) The company's net income will be the same regardless of whether LIFO or FIFO is used.
D) The company's assets will be lower if it uses LIFO as opposed to FIFO cost flow.