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Armstrong Ltd has used the average cost (AC) method to determine inventory values since the company was first formed in 2013. In 2017, the company

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Armstrong Ltd has used the average cost (AC) method to determine inventory values since the company was first formed in 2013. In 2017, the company decided to switch to the FIFO method, to conform to industry practice. The tax rate is 30%. The following data has been assembled: 2015 2016 2017 Net Income, as reported, after tax Closing inventory AC Closing inventory FIFO Dividends 3,52,400 4,14,600 1,95,400 1,48,200 84,000 36,800 2,02,800 15,600 91,200 n/a 11,400 22,000 "Net income for 2015 and 2016 is using the old policy (AC) and net income 2017 is using the new policy (FIFO) Opening retained earnings for 2016 as previously stated was 516,000 Prepare the entry in 2017 to correct the error equity for 2016 and 2017, reflecting the change REQUIRED Prepare the comparative retained earnings section of the statement of changes in shareholders' Question 1 Question 2 O Type here to search e1 @wl xl Armstrong Ltd has used the average cost (AC) method to determine inventory values since the company was first formed in 2013. In 2017, the company decided to switch to the FIFO method, to conform to industry practice. The tax rate is 30%. The following data has been assembled: 2015 2016 2017 Net Income, as reported, after tax Closing inventory AC Closing inventory FIFO Dividends 3,52,400 4,14,600 1,95,400 1,48,200 84,000 36,800 2,02,800 15,600 91,200 n/a 11,400 22,000 "Net income for 2015 and 2016 is using the old policy (AC) and net income 2017 is using the new policy (FIFO) Opening retained earnings for 2016 as previously stated was 516,000 Prepare the entry in 2017 to correct the error equity for 2016 and 2017, reflecting the change REQUIRED Prepare the comparative retained earnings section of the statement of changes in shareholders' Question 1 Question 2 O Type here to search e1 @wl xl

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