单选题 A last in, first out (LIFO) liquidation in an environment of rising prices will NOT do which of the following?

A. Increase gross income.
B. Increase taxable income.
C. Increase cost of goods sold (COGS).

【正确答案】 C

【答案解析】In a LIFO liquidation, a firm allows inventory to decrease so that it is using lower-cost materials (purchased in the past). This will lower the COGS and increase income, profit, and taxes. This is one of the ways that a firm' s management can manipulate earnings.