Massi pharmacies, Inc. started operations on January 1 2X11. The company used the average cost method t=o value inventory. Effective January 1 2X15, Massi elected to change its inventory method to the FIFO basis for reporting purposes. The following information is available for net income for average cost and for FIFO, Year ended Net Income Using Average cost Net Income Using FIFO December 31, 2X11 $235,000 $310,000 December 31, 2X12 $300,000 $376,000 December 31, 2X13 $310,000 $400,500 December 31, 2X14 $425,000 $535,000 December 31, 2X15 $500,000 $585,000 Prepare the journal entry to record the accounting change.
Massi pharmacies, Inc. started operations on January 1 2X11. The company used the average cost method t=o value inventory. Effective January 1 2X15, Massi elected to change its inventory method to the FIFO basis for reporting purposes. The following information is available for net income for average cost and for FIFO, Year ended Net Income Using Average cost Net Income Using FIFO December 31, 2X11 $235,000 $310,000 December 31, 2X12 $300,000 $376,000 December 31, 2X13 $310,000 $400,500 December 31, 2X14 $425,000 $535,000 December 31, 2X15 $500,000 $585,000 Prepare the journal entry to record the accounting change.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 14RE: Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a...
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- Massi pharmacies, Inc. started operations on January 1 2X11. The company used the average cost method t=o value inventory. Effective January 1 2X15, Massi elected to change its inventory method to the FIFO basis for reporting purposes. The following information is available for net income for average cost and for FIFO,
|
Year ended |
Net Income Using Average cost |
Net Income Using FIFO |
|
December 31, 2X11 |
$235,000 |
$310,000 |
|
December 31, 2X12 |
$300,000 |
$376,000 |
|
December 31, 2X13 |
$310,000 |
$400,500 |
|
December 31, 2X14 |
$425,000 |
$535,000 |
|
December 31, 2X15 |
$500,000 |
$585,000 |
Prepare the
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