Question

The merchandise costing method that matches the most current cost of items purchased against the current sales revenue is called the

Answer 1

Answer: LIFO

Explanation: LIFO which stands for last-in-first out is an inventory management system that considers the last inventory as the one to be disposed first. In merchandise costing, it considers the most recent cost of items purchased from the market versus the most recent sales revenue when dealing with the costing of the merchandise.

LIFO is generally not realistic for business organisations as most will not want to leave the older stock to start dealing on the newer stocks.