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What method of stock valuation is better to use in periods of inflation? FIFO or LIFO?


I have in my notes...

FIFO is the best method for firms to use in periods of inflation because it gives a higher stock valuation, lower cost of sales and higher profits.

Then...

LIFO is the worst method to use in periods of rising costs because it gives a lower stock valuation, higher cost of sales and lower profits.

Is it not the other way around?

538 day(s) ago

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Answers (1)

mike11 		It is the other way around. Somone misinformed you.

Posted 538 days ago

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Question Title What method of stock valuation is better to use in periods of inflation? FIFO or LIFO?
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