Firms that use FIFO inventory cost assumptions always include some realized holding gains in reported income in periods of

A) level prices.
B) deflation.
C) falling prices.
D) rising prices.

FIFO

"First In, First Out," an inventory valuation method where goods purchased or produced first are sold or used first.

Realized Holding Gains

Gains recognized from the sale of an investment or asset that were previously unrealized.

Rising Prices

An economic condition characterized by a general increase in consumer prices or the cost of living, often referred to as inflation.