Hi, Is the equation COGSFIFO = COGSLIFO - Change in LIFO RESERVE still holds if LIFO ReserveE and LIFO ReserveB are both negative numbers? I am wondering in the solution for question 5 in Reading 35, the LIFO reserve change from (46000) to (50000). How does it come out with a LIFO increase of 4000? If change in LIFORESERVE = LIFO ReserveE - LIFO ReserveB , shouldn’t (50000) minus (46000) equals to -4000? Why the first sentence in the solution is saying LIFO reserve increase 4000?
I have the same problem getting into my head… seems to me I should follow others and start ignoring the negative number on LIFO reserve, but I still believe the answer is not correct. It would be good if I can ignore the negative sign on my personal balance sheet