Exercise 8-15 The board of directors of Ichiro Corporation is considering whether or not it should instruct the accounting department to shift from a first-in, first-out (FIFO) basis of pricing inventories to a last-in, first-out (LIFO) basis. The following information is available. Sales 21,000 units @ $50 Inventory, January 1 6,000 units @ 20 Purchases 6,000 units @ 22 10,000 units @ 25 7,000 units @ 30 Inventory, December 31 8,000 units @ ? Operating expenses $200,000 Prepare a condensed income statement for the year on both bases for comparative purposes. Ichiro Corporation Condensed Income Statement For the year ended December 31 First-in, first-out Last-in, first-out $ $ : $ $ $ $

Exercise 8-15 The board of directors of Ichiro Corporation is considering whether or not it should instruct the accounting department to shift from a first-in, first-out (FIFO) basis of pricing inventories to a last-in, first-out (LIFO) basis. The following information is available. Sales 21,000 units @ $50 Inventory, January 1 6,000 units @ 20 Purchases 6,000 units @ 22 10,000 units @ 25 7,000 units @ 30 Inventory, December 31 8,000 units @ ? Operating expenses $200,000 Prepare a condensed income statement for the year on both bases for comparative purposes. Ichiro Corporation Condensed Income Statement For the year ended December 31 First-in, first-out Last-in, first-out $ $ : $ $ $ $

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter15: Managing Short-term Assets

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Problem 2PROB

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Exercise 8-15

The board of directors of Ichiro Corporation is considering whether or not it should instruct the accounting department to shift from a first-in, first-out (FIFO) basis of pricing inventories to a last-in, first-out (LIFO) basis. The following information is available.

Sales	21,000	units @	$50
Inventory, January 1	6,000	units @	20
Purchases	6,000	units @	22
	10,000	units @	25
	7,000	units @	30
Inventory, December 31	8,000	units @	?
Operating expenses	$200,000

Prepare a condensed income statement for the year on both bases for comparative purposes.

Ichiro Corporation Condensed Income Statement For the year ended December 31
	First-in, first-out	Last-in, first-out

			$				$

:

	$				$

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