When a company is tasked with or proposes changing their inventory methods within the company their are many factors to be considered and options to be weighed. This is only made more daunting on companies during times like we are in currently with high inflation and rising costs across the board. In this specific example we are looking at a company pondering switching their inventory methods from FIFO to LIFO. The main difference between these two methods is that LIFO assumes that the last unit to arrive in inventory or more recent is sold first, whereas FIFO assumes that the oldest unit of inventory is sold first. Typically most companies go with FIFO as companies typically use their oldest inventory first in the production of their goods. This all plays into costs as well with regards to inflation. When using LIFO when there is inflation the current COGS would be higher under LIFO because the new inventory would be more expensive. As a result, the company would record lower profits for the period. With FIFO it leaves the newer, more expensive inventory in a rising-price environment, on the balance sheet. As a result, FIFO can increase net income because inventory that might be several years old-which was acquired for a lower cost-is used to value COGS. But a negative to this is that FIFO can lead to a higher tax bill. When looking at times of high inflation like we are now LIFO does seem to look better from a cost perspective as well as a tax perspective. But if you look at GAAP and IFRS reporting you should know that companies outside of the United States that us IFRS are not permitted to use LIFO as their inventory method. Whereas companies with the United States have more options and are able to choose to use LIFO of FIFO if they like. How do I respond to this