The July 15, 2010, edition of CFO.com contains an article by Marie Leone entitled “Sucking the LIFO out of Inventory.”
Instructions
Read the article, which can be found at www.cfo.com/printable/article.cfm/14508745 ,and answer the following questions.
(a) What type of company benefits most from the use of LIFO?
(b) What is the estimated boost in federal tax receipts over 10 years if the use of LIFO for taxes was not allowed?
(c) If the United States decides to adopt International Financial Reporting Standards (IFRS), what would be the implications for IFRS?
(d) What conceptual justification for LIFO do its proponents provide?
(e) What types of companies prefer to use FIFO?