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Indicate the decision that will yield a higher net profit

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Reference no: EM13865734

For each of the following three accounting choices, indicate the decision that will yield

(a) a higher net profit margin and

(b) a lower current ratio. If the decision does not affect the ratio, indicate no effect.

1. Straight- line versus accelerated depreciation (in the first year of the assets life).

2. FIFO versus LIFO (in periods of constantly rising costs and rising inventory levels).

 

3. Straight- line depreciation with a four- year useful life versus a seven- year useful life (no residual value). 

Reference no: EM13865734

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