LiquidAssets10

I had the same problem with exactly the same question
I don’t wish to make this any more confusing but could you please help me understand better too
I also understand the FIFO method vs the WA and even LIFO, even though LIFO is not mentioned in this inflationary environment. The logic there is fine.
Here’s my logic for the temporal method vs the current method
Under the temporal method closing inventory as reported on the balance sheet is exchanged at the historical exchange rate, right? Yes! So if the subsidiary’s functional currency is depreciating, then it’s a higher value than under the current method using the current and lower exchange rate, right? Yes
So if we define COGS as:
+Opening inventory
+Net purchases
-Closing Inventory
Then the higher closing inventory under the temporal should lower COGS and hence improve the Gross Profit Margin. This is my logic however it is wrong because the answer to question two, is the current method.
There is no real difference between the COGS under the current method and the temporal method other than preciseness. This is because the temporal method expenses the items that are sold using  individual exchange rates for each item on the day it was purchased. The current method on the other hand, is a lot less precise because it just uses an average exchange rate for all COGS.
If anyone could help please. I have thought this through but the logic is too long winded and time consuming and most importantly I arrive at the wrong answer. Can someone please go through the step by step logic to answering a question like this, so I can get right any future questions of this sort.