LIFO Reserve

Accounting Terms Dictionary

Select a letter below to view all accounting terms that begin with that letter.

LIFO Reserve

The difference between inventory calculated using FIFO inventory method and inventory calculated using LIFO.

Using LIFO usually generates a larger deduction than FIFO, decreasing a company’s income tax. Figuring the LIFO reserve helps companies figure out how much larger that deduction was and just how much tax was deferred.

There is currently no content classified with this term.

Get instant access to step-by-step instructions on how to apply and sit for the CPA Exam.