In general, in a period of falling prices, LIFO produces higher gross profits than FIFO is a true statement.
Gross profit provides insight into how efficient an organization/company is at managing its production prices, such as labor and supplies, to provide income from the sale of its goods and services. The gross profit for an organization/company is calculated by subtracting the price of products sold for the accounting duration from its total sales.
You can find the gross profit by subtracting the cost of goods sold (COGS) from the revenue. for instance, if an organization/company had $10,000 in revenue and $4,000 in COGS, the gross income would be $6,000. This parent is on your earnings statement.
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