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E8.18 (LO 4) (LIFO Eff ect) The following example was provided to encourage the use of the LIFO method. In a nutshell, LIFO subtracts infl ation from inventory costs, deducts it from taxable income, and records it in a LIFO reserve account on the books. The LIFO benefi t grows as infl ation widens the gap between current-year and past-year (minus infl ation) inventory costs. This gap is:
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E8.18 (LO 4) (LIFO Eff ect) The following example was provided to encourage the use of the LIFO meth...
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