Question: Assume that a firm separately determined inventory under fifo and lifo and then compared the results.
1. In each space below, place the correct sign [less than (<), greater="" than=""><), or="" equal="" (=")]" for="" each="" comparison,="" assuming="" periods="" of="" rising="">
a. Lifo inventory _________ Fifo Inventory
b. Lifo cost of goods sold _________ Fifo cost of goods sold
c. Lifo net income _________ Fifo net income
d. Lifo income tax _________ Fifo income tax
2. Why would management prefer to use lifo over fifo in periods of rising prices?