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    Principle Reason for Selecting LIFO Cost Flow Assumption

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    One of the principal reasons for selecting the LIFO cost flow assumption instead of the FIFO cost flow assumption in a inflationary economic environment is that:
    a) net income will be higher
    b) income taxes will be lower
    c) balance sheet inventory value will be higher
    d) a higher selling price can be established.

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    Solution Summary

    This solution provides the correct choice with explanation to the LIFO question listed.