Evidence on the determinants of inventory accounting policy choice

Article Abstract:

The basis for the optimal choice of an inventory accounting policy remains elusive, but additional evidence regarding the factors influencing this choice have been determined. A survey was conducted on the selection of last in, first out (LIFO) or first in, first out (FIFO) as an inventory accounting method among 223 firms. The survey showed that LIFO users regard the method's ability to reduce income taxes and facilitate better cost matching as its strong points. FIFO users, on the other hand, preferred the method for its ability to provide a better reflection of the actual flow of the physical distribution of goods and the method's greater accuracy in valuation as reflected on balance sheets. The reasons for the resistance of firms to switch from FIFO to LIFO on the basis of LIFO's tax saving advantage is also examined.

Methods, Accounting and auditing, Inventory control

---

An analysis of the impact of state income tax rates and bases on foreign investment

Article Abstract:

The impact of state corporate income tax and tax base structure on foreign investment is examined. A supply-oriented theory of regional investment is used to develop an econometric model of foreign investment. Results indicate that the use of unitary accounting methods affect the amount of foreign investments. Business income tax rates do not have a strong effect on foreign investment.

Research, International aspects, Corporate income taxes, Income tax

---

Similar abstracts:

• Abstracts: An analysis of ACRS during inflationary periods. The effects of information choice and information use on analysts' predictions of municipal bond rating changes

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.