Jan. 1 Apr. 1 Oct. 1 Beginning inventory Purchased Purchased 400 units $18 $23 2,500 units 1,000 units @ $24 @ @ uring the year, Parvin sold 3,315 units of inventory at $41 per unit and incurred $15,200 of operating expenses. Parvin currently uses he FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. arvin started the period with cash of $152,800, inventory of $7,200, common stock of $136,000, and retained earnings of $24,000. Cequired . Prepare income statements using FIFO and LIFO. . Determine the amount of income tax that Parvin would pay using each cost flow method. . Determine the cash flow from operating activities under FIFO and LIFO.
Jan. 1 Apr. 1 Oct. 1 Beginning inventory Purchased Purchased 400 units $18 $23 2,500 units 1,000 units @ $24 @ @ uring the year, Parvin sold 3,315 units of inventory at $41 per unit and incurred $15,200 of operating expenses. Parvin currently uses he FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. arvin started the period with cash of $152,800, inventory of $7,200, common stock of $136,000, and retained earnings of $24,000. Cequired . Prepare income statements using FIFO and LIFO. . Determine the amount of income tax that Parvin would pay using each cost flow method. . Determine the cash flow from operating activities under FIFO and LIFO.
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter3: The Basics Of Record Keeping And Financial Statement Preparation: Income Statement
Section: Chapter Questions
Problem 7E
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