问题如下：
5. If Karp had used FIFO instead of LIFO, which of the following ratios computed as of 31 December 2009 would most likely have been lower?
选项：
A.Cash ratio.
B.Current ratio.
C.Gross profit margin.
解释：
A is correct.
The cash ratio (cash and cash equivalents ÷ current liabilities) would be lower because cash would have been less under FIFO. Karp’s income before taxes would have been higher under FIFO, and consequently taxes paid by Karp would have also been higher and cash would have been lower. There is no impact on current liabilities. Both Karp’s current ratio and gross profit margin would have been higher if FIFO had been used. The current ratio would have been higher because inventory under FIFO increases by a larger amount than the cash decreases for taxes paid. Because the cost of goods sold under FIFO is lower than under LIFO, the gross profit margin would have been higher.
There is no impact on current liabilities.
used FIFO instead of LIFO, inventory应该减少了，current asset应该减少了
