Susan Smith, president of Miami Co., recently read an article
that claimed that at least 100 of the country's largest 500
companies were either adopting or considering adopting the last-in,
first-out (LIFO) method for valuing inventories. The article stated
that the firms were switching to LIFO to (1) neutralize the effect
of inflation in their financial statements, (2) eliminate inventory
profits, and (3) reduce income taxes. Ms. Smith wonders if the
change would benefit her company. Miami Co. currently uses...