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In 2018, Hopyard Lumber changed its inventory method from LIFO to FIFO. Inventory at the end...
Aquatic Equipment Corporation decided to switch from the LIFO method of costing inventories to the FIFO...
Aquatic Equipment Corporation decided to switch from the LIFO method of costing inventories to the FIFO method at the beginning of 2018. The inventory as reported at the end of 2017 using LIFO would have been $64,000 higher using FIFO. Retained earnings at the end of 2017 was reported as $820,000 (reflecting the LIFO method). The tax rate is 34%. Required: 1. Calculate the balance in retained earnings at the time of the change (beginning of 2018) as it would...
On January 1, 2018, Delta changed its inventory valuation method from LIFO to FIFO for financial...
On January 1, 2018, Delta changed its inventory valuation method from LIFO to FIFO for financial statement purposes. The change will result in an $800,000 increase in inventory at January 1, 2018. The tax rate is 30%. How much should retained earnings be adjusted (indicate direction and dollar amount) so that it is correct (using the new method) as of January 1, 2018
Joey Co. decided to switch from LIFO method of costing inventories to the FIFO method at...
Joey Co. decided to switch from LIFO method of costing inventories to the FIFO method at the beginning of 2018 [1/1/2019]. The inventory as reported at the end of 2016 using LIFO would have been $60,000 higher using FIFO. Retained earnings had been reported at 12/31/2018 as $780,000 [reflecting the LIFO method]. The Tax rate is 40% 1). Calculate the balance in retained earnings at the time of the change [beginning of 20191 as it would have been reported if...
Fantasy Fashions had used the LIFO method of costing inventories, but at the beginning of 2018...
Fantasy Fashions had used the LIFO method of costing inventories, but at the beginning of 2018 decided to change to the FIFO method. The inventory as reported at the end of 2017 using LIFO would have been $27 million higher using FIFO. Retained earnings reported at the end of 2016 and 2017 was $247 million and $267 million, respectively (reflecting the LIFO method). Those amounts reflecting the FIFO method would have been $257 million and $279 million, respectively. 2017 net...
Fantasy Fashions had used the LIFO method of costing inventories, but at the beginning of 2018...
Fantasy Fashions had used the LIFO method of costing inventories, but at the beginning of 2018 decided to change to the FIFO method. The inventory as reported at the end of 2017 using LIFO would have been $13 million higher using FIFO. Retained earnings reported at the end of 2016 and 2017 was $233 million and $253 million, respectively (reflecting the LIFO method). Those amounts reflecting the FIFO method would have been $243 million and $265 million, respectively. 2017 net...
Wolfgang Kitchens has always used the FIFO inventory costing method for both financial reporting and tax...
Wolfgang Kitchens has always used the FIFO inventory costing method for both financial reporting and tax purposes. At the beginning of 2018, Wolfgang decided to change to the LIFO method. Net income in 2018 was correctly stated as $106 million. If the company had used LIFO in 2017, its cost of goods sold would have been higher by $15 million that year. Company accountants are able to determine that the cumulative net income for all years prior to 2017 would...
he Cecil-Booker Vending Company changed its method of valuing inventory from the average cost method to...
he Cecil-Booker Vending Company changed its method of valuing inventory from the average cost method to the FIFO cost method at the beginning of 2018. At December 31, 2017, inventories were $124,000 (average cost basis) and were $128,000 a year earlier. Cecil-Booker’s accountants determined that the inventories would have totaled $163,000 at December 31, 2017, and $168,000 at December 31, 2016, if determined on a FIFO basis. A tax rate of 40% is in effect for all years. One hundred...
Exercise 8-17 FIFO, LIFO, and average cost methods [LO8-1, 8-4] Causwell Company began 2018 with 14,000...
Exercise 8-17 FIFO, LIFO, and average cost methods [LO8-1, 8-4] Causwell Company began 2018 with 14,000 units of inventory on hand. The cost of each unit was $4.00. During 2018 an additional 34,000 units were purchased at a single unit cost, and 24,000 units remained on hand at the end of 2018 (24,000 units therefore were sold during 2018). Causwell uses a periodic inventory system. Cost of goods sold for 2018, applying the average cost method, is $136,800. The company...
Swifty Co. decides at the beginning of 2017 to adopt the FIFO method of inventory valuation. Swifty had used the LIFO method for financial reporting since its inception on January 1, 2015, and had mai...
Swifty Co. decides at the beginning of 2017 to adopt the FIFO method of inventory valuation. Swifty had used the LIFO method for financial reporting since its inception on January 1, 2015, and had maintained records adequate to apply the FIFO method retrospectively. Swifty concluded that FIFO is the preferable inventory method because it reflects the current cost of inventory on the balance sheet. The following table presents the effects of the change in accounting principles on inventory and cost...
Best Care Company began operations on January 1, 2017, and uses the FIFO method in costing...
Best Care Company began operations on January 1, 2017, and uses the FIFO method in costing its raw material inventory. Management changed the inventory valuation method to the LIFO method in 2018. Corporate accounting staff has determined what effect such a change will have on net income. The Tax Rate is 40% for all years. Accordingly, the following information has been developed 2017 2018 Net Income (computed under the FIFO method $500,000 $750,000 Ending Inventory under FIFO method $320,000 $400,000...
Joey Co. decided to switch from LIFO method of costing inventories to the FIFO method at the beginning of 2018 [1/1/2019]. The inventory as reported at the end of 2016 using LIFO would have been $60,000 higher using FIFO. Retained earnings had been reported at 12/31/2018 as $780,000 [reflecting the LIFO method]. The Tax rate is 40% 1). Calculate the balance in retained earnings at the time of the change [beginning of 20191 as it would have been reported if...
Fantasy Fashions had used the LIFO method of costing inventories, but at the beginning of 2018 decided to change to the FIFO method. The inventory as reported at the end of 2017 using LIFO would have been $13 million higher using FIFO. Retained earnings reported at the end of 2016 and 2017 was $233 million and $253 million, respectively (reflecting the LIFO method). Those amounts reflecting the FIFO method would have been $243 million and $265 million, respectively. 2017 net...
Exercise 8-17 FIFO, LIFO, and average cost methods [LO8-1, 8-4] Causwell Company began 2018 with 14,000 units of inventory on hand. The cost of each unit was $4.00. During 2018 an additional 34,000 units were purchased at a single unit cost, and 24,000 units remained on hand at the end of 2018 (24,000 units therefore were sold during 2018). Causwell uses a periodic inventory system. Cost of goods sold for 2018, applying the average cost method, is $136,800. The company...
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