A company is experiencing continuously lower costs. Which cost flow assumption will result in less income tax expense for this company?

First In, First Out - FIFO

a.FIFO

Answer A FIFO

FIFO

low income tax figure can be achieved if groos profit/profit is lower.

if company uses lifo costing method and prices of that material are increasing, then cost of goods sold will be higher resulting in lower groos profit and ending inventory figure.viceversa for FIFO.