Final answer:
Most companies use the FIFO (First-In, First-Out) method for internal record keeping of inventory, as it aligns with the typical flow of goods and is widely accepted internationally. Option C is correct.
Step-by-step explanation:
For internal record keeping, most companies carry their inventory using the FIFO basis. FIFO stands for First-In, First-Out, and it means that the costs of the earliest goods purchased are the first to be recognized in determining cost of goods sold. Alternatively, LIFO (Last-In, First-Out), specific identification, and average cost are other methods used, but FIFO is the most common because it aligns with the typical flow of goods and is accepted under the International Financial Reporting Standards (IFRS). Using FIFO can result in lower cost of goods sold and higher reported profits when prices are rising, which can have tax implications.