Interactive Tech Company just started business and is trying to decide which inventory cost formula to use.

Question:

Interactive Tech Company just started business and is trying to decide which inventory cost formula to use. Assuming prices are falling, as they oft en do in the information technology sector, answer the following questions for Interactive Tech:
(a) Which formula will result in the higher ? Explain.
(b) Which formula will result in the higher cost of goods sold? Explain.
(c) Which formula will result in the higher cash flow? Explain.
(d) What factors are important for Interactive Tech to consider as it tries to choose the most appropriate inventory cost formula?
Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...