[marolmos]

In times of falling prices, choosing LIFO over FIFO as an inventory cost method would affect the financial statements as follows:
Answer

Cost of goods sold will be higher and ending inventory will be lower

Cost of goods sold will be lower and ending inventory will be lower

Cost of goods sold will be higher and ending inventory will be higher

Cost of goods sold will be lower and ending inventory will be higher

none of the above

[pready]

Last In First Out means that the last items purchased will be the first ones sold, so with falling prices LIFO will have a lower price and ending inventory will be the purchases with higher prices.

First In First Out will have the opposite effect of LIFO.