Multiple Choice
GG Inc. uses LIFO. GG disclosed that if FIFO had been used, inventory at the end of 2013 would have been $15 million higher than the difference between LIFO and FIFO at the end of 2012. Assuming GG has a 40% income tax rate:
A) Its reported cost of goods sold for 2013 would have been $9 million higher if it had used FIFO rather than LIFO for its financial statements.
B) Its reported cost of goods sold for 2013 would have been $15 million higher if it had used FIFO rather than LIFO for its financial statements.
C) Its reported net income for 2013 would have been $9 million higher if it had used FIFO rather than LIFO for its financial statements.
D) Its reported net income for 2013 would have been $15 million higher if it had used FIFO rather than LIFO for its financial statements.
Correct Answer:
Verified
Correct Answer:
Verified
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