A possible investor examines the financial statements of four companies. Their income statements each report the same revenue and the same operating profit. The cost of buying inventory is rising. company $1$ values inventory using AVCO company $2$ values inventory using FIFO company $3$ uses absorption costing company $4$ uses marginal costing The investor wants to put money into companies with the strongest underlying profitability. Which companies ought he select?
- A1 and 3
- B1 and 4
- C2 and 3
- D2 and 4