The management of Blue Spruce Corp. is reevaluating the appropriateness of using its present inventory cost flow method, which is average-cost. The company requests your help in determining the results of operations for 2022 if either the FIFO or the LIFO method had been used. For 2022, the accounting records show these data: Inventories Purchases and Sales Beginning ( 10,500 units) $ 21,000 Total net sales ( 270,000 units) $ 1,120,500 Ending ( 25,500 units) Total cost of goods purchased ( 285,000 units) 645,750 Purchases were made quarterly as follows. Quarter Units Unit Cost Total Cost 1 75,000 $2.05 $ 153,750 60,000 2.15 129,000 3 60,000 2.30 138,000 90,000 2.50 225,000 285,000 $645,750 Operating expenses were $ 130,000, and the company's income tax rate is 40%. 2.
The management of Blue Spruce Corp. is reevaluating the appropriateness of using its present inventory cost flow method, which is average-cost. The company requests your help in determining the results of operations for 2022 if either the FIFO or the LIFO method had been used. For 2022, the accounting records show these data: Inventories Purchases and Sales Beginning ( 10,500 units) $ 21,000 Total net sales ( 270,000 units) $ 1,120,500 Ending ( 25,500 units) Total cost of goods purchased ( 285,000 units) 645,750 Purchases were made quarterly as follows. Quarter Units Unit Cost Total Cost 1 75,000 $2.05 $ 153,750 60,000 2.15 129,000 3 60,000 2.30 138,000 90,000 2.50 225,000 285,000 $645,750 Operating expenses were $ 130,000, and the company's income tax rate is 40%. 2.
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
Chapter22: Accounting For Changes And Errors.
Section: Chapter Questions
Problem 11RE: At the end of 2019, Manny Company recorded its ending inventory at 350,000 based on a physical...
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