Question

Required information [The following information applies to the questions displayed below.] The following information pertains to the inventory of Parvin Company during Year 2: Jan. 1 Beginning Inventory 600 units @ $ 37 Apr. 1 Purchased 3,050 units @ $ 42 Oct. 1 Purchased 800 units @ $ 45 During Year 2, Parvin sold 4,200 units of inventory at $85 per unit and incurred $51,500 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 40 percent income tax rate. Parvin started the period with cash of $95,000, inventory of $22,200, common stock of $70,000, and retained earnings of $47,200. Required a. Record the above transactions in general journal form and post to T-accounts using (1) FIFO and (2) LIFO. Use a separate set of journal entries and T-accounts for each method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) FIFO

Answer 1

Gorical ournal under FIFO Method Datu Duscription Gencral jau mallunder LIFO Method Dute Description IDalin S lowdit lin SI Apr 01 Muhand m y Ar-01 Muncu immunce shell 3:1-111 Muhand y l ing, inwency purchased | |- | 14:* ) Dash (125 357 3,5/10 Ibens les made Operatit penses $1.500 51.500 51,900 Uperating i penses Cash Ibenc expenses incurred! being expenses incurred 1.75,000 177.050 Cost of coods sold Merchandise inventory being cost of inventory sold under FIFOI 000373030*42.550 451 1,75,050 Cost of goods sold Merchandise inventory Ibeing cost of i ntory sold under LIFO 1330"37 3030"42 800-45) 1,77,050 52.180 51,320 52.180 Income tax cxpcnse Provision for Income Tax being provision made ES57000 173050 515001405 Income Tax CepSC Provision for income Tax being provon made 1357000 177050 51500404 Gaste Ch A lin si Dulu 06000 60100 Our bukan Ckring Bulan DISCURI Ar-01 Merc Oul-01 Mercu u Ammunis ry 178100 y ANTHLimil |ins Duli 9500 64100 lพราil :sale: ละละ Cuir r iyaiகபாட ins) 01 March 2R100 0 Merc 38000 r y 1 161100 15400 164120 14100 VIS IKKI Y хкi r? Түнгіn tsІнтен Yr7TTHREINS eing ping Terning 41011 S12 Amount in Si Date Description Amount in SI Amount lin) Date Descriptio mount in ) Merchandise inventory Date Description Yr 1 Opening balance Per 01 Cash Oct-01 Cash Merchandise inventory Description Opening balance Aprol Cash Oct 01 Cash 128100 3000 yri 128100 36000 y 1 Closing balance 195300 Closing ba 186300 186300 180300 180300 186300 W2 Osning balance 173050 Yr 2 Opening balance 186300 vr 2 136300 yr 2 Yr 2 186300 Cost of noods sold Closing balance Cost of Closinta 177030 D2SO 196800 13600 186300 Coll de sold Caslautased Amin Si Dulu Diri Asuni SI பாins Dul i uiu காபபாடா) Morichandise Common Stark mit Amesnt fins a Derin rent in 5) Sales Date Description Amount in Si uste Amount ins) Date Description Cash Amount in si 357000 Descriptio mount in S) Cash 357000 Retained caring Date Description Amount in Si Date Retained camines Date Description Amountiins) Date Description Opening balance Amount in $1 47200 Descriptio Opening nonton $ 47200 Operating SES Dula Design v> Am i n Si Dule Descript Dule YI DS taste Britamil [in si Dale strini Aruurtins) In lux H D H Der Armour Arrel is) Ambullin S 521 Dl Dm yr2 Pwint for Animalis Di 51:10 min Provision for income the De Description Amount in Siunte Description Provision for income tax Uate Description Amount in SI Amount in Unte l escriptio mount in ) eta esper Income ta 1200