alleryUnder LIFO, the cost of goods sold corresponds to:
AEarliest purchases (oldest)
BAn average of all purchases
CMost recent purchases first
DSpecific lots identified
Answer & Solution
Correct answer: C. Most recent purchases first
1. LIFO assigns the cost of the latest purchases to issues / cost of goods sold.
2. Closing inventory under LIFO then comprises the oldest consignments.
3. This matches current cost with current revenue.
_Source: ICAI BoS Foundation Paper 1, Ch 4 "Inventories", §5.1 (iii)_
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