Answer Question 1 (a-e); make sure to save your answers at the end of the page. a. In the notes to the financial statements, the following information should not be included:. the major inventory classifications the cost determination method (FIFO, specific identification, or average cost) the fact that inventory is values at the lower of cost or net realization value the amount inventory is written up above its original cost b. In a period of rising prices, Cost of Goods sold is higher using average cost, compared with FIFO Compared with average cost, FIFO results in lower gross profit Compared with average cost, FIFO has lower ending inventory Compared with FIFO, average cost has higher shareholders' equity c. Which of the following statements is not true?. Specific identification exactly matches costs and revenues. Average cost tends to smooth out price changes. FIFO assigns an amount to inventory that is lower of cost or net realizable value FIFO assigns the oldest costs incurred to cost of goods sold. d. Which of the following statements is not true? During periods of rising prices, FIFO results in the highest net income. During periods of rising prices, the average cost formula results in the highest cost of goods sold. During periods of rising prices, FIFO has the highest retained earnings. During periods of rising prices, the average cost formula has the highest ending inventory. e. Net realizable value is the selling price of the goods. the salvage value of the goods. the price paid for the goods. O the selling price less any costs required to make the goods ready for sale