a if merchandise inventory is being valued at cost and the p

(a) if merchandise inventory is being valued at cost and the price level is decreasing, which of the three methods of costing-FIFO, LIFO, ir weighted average.

(d) the lowest gross profit?

Solution

lowest gross profit will be reported by FIFO
[FIFO assigns the oldest purchases to the \'Cost of Goods Sold\' expense account. Since prices are decreasing, this method will result in a higher COGS amount than LIFO or average cost, and a higher expense amount results in a lower gross profit number.]