Can someone explain why #1 is C? Like a thorough conceptual explanation?

ve 20. Petunia Co YO (1) Ricky Gutie evDCustomer CenX ining.uh.edu/bbeswebdav/pid-4659573-dt-content-rid-32225645,1/courses/H 20183 ACCT,3367 actice X Answer Key is at the end of this document. 1. Earl Co. was formed on January 2, 2007, to sell a single product. Over a two-year period, Earl's acquisition costs have increased steadily. Physical quantities held in inventory were equal to three months' sales at December 31, 2007, and zero at December 31, 2008. Assuming the periodie inventory system, the inventory cost method which reports the highest mount of each of the following is Inventory Cost of Goods Sold December 31 2007 2008 a. b. c. d. LIFO LIFO FIFO FIFO FIFO LIFO FIFO LIFO 2: Goods in transit which are shipped f..b, destination should be: a included in the inventory of the seller b included in the inventory of the buyer. ecineluded in the inventory of the shipping company d. none of these. 4 When a company uses LIFO for external reporting purposes and FIFO for internal reporting purposes. an Allowance to Reduce Inventory to LIFO account is used. This account should be reported a. on the income statement in the Other Revenues und Giains s