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AEP Industries Inc. is a leading manufacturer of plastic packing films. The company uses the LIFO inventory method for external reporting but maintains its internal
AEP Industries Inc. is a leading manufacturer of plastic packing films. The company uses the LIFO inventory method for external reporting but maintains its internal records using FIFO. The following disclosure note was included in a recent quarterly report 4. Inventorles (In part) Inventories are comprised of the following ($ in thousands) October 31, January 31, 2016 2015 $ 51,383 96,483 6,165 154,031 (17,576) Raw materials 49,967 86,363 6,622 142,952 (21,670) Finished goods Supplies Less: LIFO reserve Inventories (under LIFO) 136,455 121,282 The company's income statements reported cost of goods sold of $217,326 thousand for the quarter ended January 31, 2016 Required: 1. Assume that AEP adjusts the LIFO reserve at the end of its quarter. Prepare the January 31, 2016, adjusting entry to record the cost of goods sold adjustment. 2. If AEP had used FIFO to value its inventories, what would cost of goods sold have been for the quarter ended January 31, 2016
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