Aphysical inventory on december 31 shows 3,000 units on hand. henri sells the units for $12 each. the company has an effective tax rate of 20%. henri uses the periodic inventory method. what is the difference in taxes if lifo rather than fifo is used?

Lifo in inflationary- condition Income tax shows minimum amount, when there is inflation in the economy.

Fifo In inflationary condition, income tax shows a higher amount.

Lifo .in deflation .In case of deflation, larger amount of income tax is shown.Fifo  in deflation .Reduced income tax will be shown in deflationary conditions

Explanation:

Lifo in inflationary- condition Income tax shows minimum amount, when there is inflation in the economy.

Fifo In inflationary condition, income tax shows a higher amount.

Lifo .in deflation .In case of deflation, larger amount of income tax is shown.Fifo  in deflation .Reduced income tax will be shown in deflationary conditions.

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