If a Company Experiences a Liquidation of a LIFO Inventory

Multiple Choice

If a company experiences a liquidation of a LIFO inventory layer in the second quarter that is expected to be restored by the end of the annual financial reporting period,the company should

A) treat the layer as if it were liquidated and include in cost of goods sold the expected replacement cost of the inventory sold.
B) deplete the LIFO layer as if the interim period were an annual period.
C) change to an alternative inventory cost method,such as FIFO,so that the of LIFO liquidation is not encountered.
D) delay the recognition of both revenue and cost of goods sold on the inventory involved until a final determination of the LIFO inventory can be made at the end of the annual period.