Required information
Use the following information for the Exercises below.
[The following information applies to the questions
displayed below.]
Laker Company reported the following January purchases and sales data for its only product.
Date | Activities | Units Acquired at Cost | Units sold at Retail | |||||||||||||||
Jan. | 1 | Beginning inventory | 145 | units | @ | $ | 7.00 | = | $ | 1,015 | ||||||||
Jan. | 10 | Sales | 105 | units | @ | $ | 16.00 | |||||||||||
Jan. | 20 | Purchase | 70 | units | @ | $ | 6.00 | = | 420 | |||||||||
Jan. | 25 | Sales | 85 | units | @ | $ | 16.00 | |||||||||||
Jan. | 30 | Purchase | 190 | units | @ | $ | 5.50 | = | 1,045 | |||||||||
Totals | 405 | units | $ | 2,480 | 190 | units | ||||||||||||
The Company uses a perpetual inventory system. For specific
identification, ending inventory consists of 215 units, where 190
are from the January 30 purchase, 5 are from the January 20
purchase, and 20 are from beginning inventory.
rev: 03_14_2019_QC_CS-162819
Exercise 5-4 Perpetual: Income effects of inventory methods LO A1
Required:
1. Complete comparative income statements for the month of
January for Laker Company for the four inventory methods. Assume
expenses are $1,300, and that the applicable income tax rate is
40%. (Round your Intermediate calculations to 2 decimal
places.)
2. Which method yields the highest net
income?
LIFO
FIFO
Weighted average
Specific identification
3. Does net income using weighted average fall
between that using FIFO and LIFO?
No
Yes
4. If costs were rising instead of falling, which
method would yield the highest net income?
FIFO
Specific identification
Weighted average
LIFO
Answer:
1
Working notes for the answer:
_____________________________________________________________________
2
Which method yields the highest net income?
Answer: LIFO
_____________________________________________________________________
3
Does net income using weighted average fall between that using FIFO and LIFO?
Answer: Yes
___________________________________________________________________
4
If costs were rising instead of falling, which method would yield the highest net income?
Answer: FIFO
Required information Use the following information for the Exercises below. [The following information applies to the...
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Date Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beginning inventory 240 units @ $ 16.50 = $ 3,960 Jan. 10 Sales 190 units @ $ 25.50 Jan. 20 Purchase 170 units @ $ 15.50 = 2,635 Jan. 25 Sales 190 units @ $...
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.) Laker Company reported the following January purchases and sales data for its only product. Units sold at Retail Units Acquired at Cost 215 units @ $14.00 = $3,010 165 units @ $23.00 Date Activities Jan. 1 Beginning inventory Jan. 10 Sales Tan. 20 Purchase Jan. 25 Sales Jan. 30 Purchase Totals 160 units @ $13.00 = 2,080 190 units @ $23.00...
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Date Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beginning inventory 180 units @ $ 10.50 = $ 1,890 Jan. 10 Sales 140 units @ $ 19.50 Jan. 20 Purchase 110 units @ $ 9.50 = 1,045 Jan. 25 Sales 130 units @ $...
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Date Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beginning inventory 240 units @ $ 16.50 = $ 3,960 Jan. 10 Sales 190 units @ $ 25.50 Jan. 20 Purchase 170 units @ $ 15.50 = 2,635 Jan. 25 Sales 190 units @ $...
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beginning inventory 140 units @ $6.00 - $340 100 units@ $15 60 units @ $5.00 = 80 units @ $15 180 units@ $4.50 - Totals 180 units Date 300 Jan. 10 Sales Jan. 20 Purchase Jan....
Chapter 05 Homework i Saved Required information [The following information applies to the questions displayed below.) Part 2 of 2 Laker Company reported the following January purchases and sales data for its only product. Units sold at Retail points Units Acquired at Cost 145 units @ $7.00 - $1,015 105 units @ $16.00 Date Activities Jan. 1 Beginning inventory Jan. 10 Sales Jan. 20 Purchase Jan. 25 Sales Jan. 30 Purchase Totals 70 units @ $6.00 = 420 85 units...
Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Date Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beginning inventory 180 units @ $ 10.50 = $ 1,890 Jan. 10 Sales 140 units @ $ 19.50 Jan. 20 Purchase 110 units @ $ 9.50 = 1,045 Jan. 25 Sales 130 units @ $ 19.50 Jan....
Required information [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Date Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beginning inventory 225 units @ $ 15.00 = $ 3,375 Jan. 10 Sales 175 units @ $ 24.00 Jan. 20 Purchase 180 units @ $ 14.00 = 2,520 Jan. 25 Sales 210 units @ $ 24.00 Jan. 30 Purchase 350 units @ $...
Required information Use the following information for the Exercises below. (The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. Date Activities Jan. Beginning inventory Jan. 10 Sales Jan. 20 Purchase Jan. 25 Sales Jan. 30 Purchase Totals Units Acquired at Cost Units sold at Retail 185 units @ $11.00 - $2,035 145 units @ $20.00 100 units @ $10.00 - 1,000 125 units @ $20.00 270...
Required information (The following information applies to the questions displayed below.) Laker Company reported the following January purchases and sales data for its only product. IN Units Acquired at Cost 185 units@ $11.00 – $2,035 Units sold at Retail 145 units @ $20.00 Date Activities Jan. 1 Beginning inventory Jan. 10 Sales Jan. 20 Purchase Jan. 25 Sales Jan. 30 Purchase Totals 100 units $10.00 - 1,000 125 units @ $20.00 270 unitse $ 9.50 - 555 units 2,565 $5,600...