ACC 304 All Assignments ACC 304 All Assignments | Page 69

11. The change in the LIFO Reserve from one period to the next is
recorded as an adjustment to Cost of Goods Sold.
12. Many companies use LIFO for both tax and internal reporting
purposes.
13. LIFO liquidation often distorts net income, but usually leads to
substantial tax savings.
14. LIFO liquidations can occur frequently when using a specific-
goods approach.
15. Dollar-value LIFO techniques help protect LIFO layers from
erosion.