Question

Broadhead Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 2: Units 2,850 Unit Cost S 13 Inventory, December 31, prior year For the current year: Purchase, April 11 Purchase, June 1 Sales ($53 each) Operating expenses (excluding income tax expense) 8,840 7.820 10,860 16 $186,500 value: 10.00 points Required information Required: 1. Prepare a separate income statement through pretax income that details cost of goods sold for (a) Case A: FIFO and (b) Case B: LIFO. BROADHEAD COMPANY Income Statement For the Year Ended December 31, current year Case A FIFO Case B LIFO Cost of goods sold: Beginning inventory Purchases 0 0 Goods available for sale Ending inventory Cost of goods sold Gross profit Operating expenses

Answer 1

BROADHEAD COMPANY Income Statement For the Year Ended December 31, Current Year Case A FIFO 575580 Case B LIFO 575580 Sales revenue Cost of goods sold: Beginning Inventory Purchases Purchases Goods available for sale Ending Inventory 37050 97240 125120 259410 134250 37050 97240 125120 259410 100850 Cost of goods sold Gross Profit Operating Expenses 125160 450420 186500 158560 417020 1865001 Net income 263920 230520