In preparation for significant expansion of its international operations, Sheridan Co. has adopted a plan to gradually shift to the same accounting methods as used by its international competitors. Part of this plan includes a switch from LIFO inventory accounting to FIFO (recall that IFRS does not allow LIFO). Sheridan decides to make the switch to FIFO at January 1, 2020. The following data pertains to Sheridan's 2020 financial statements in millions of dollars). Sales Inventory purchases 12/31/20 inventory (using FIFO) Compensation expense $570 370 600 19 All sales and purchases were with cash. All of 2020's compensation expense was paid with cash. (Ignore taxes.) Sheridan's property, plant, and equipment cost $420 million and has an estimated useful life of 10 years with no salvage value. Sheridan Co. reported the following for fiscal 2019 (in millions of dollars): SHERIDAN CO. BALANCE SHEET AT DECEMBER 31, 2019 2019 2018 Cash $ 383 $ 220 Common stock Inventory 520 500 Retained earnings Property, plant, and equipment 420 Accumulated depreciation (84) (42) Total assets $ 1,239 $ 1,098 Total equity 2019 $ 520 719 2018 $ 520 578 420 $ 1.239 $ 1.098 SHERIDAN CO. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2019 2019 Sales $ 520 Cost of goods sold (320) Depreciation expense (42) Compensation expense (17) Net income $ 141 Summary of Significant Accounting Policies Inventory: The company accounts for inventory by the LIFO method. The current cost of the company's inventory, which approximates FIFO, was $62 and $52 higher at the end of fiscal 2019 and 2018, respectively, than those reported in the balance sheet. Compute Sheridan's inventory turnover for 2019 and 2020 under both LIFO and FIFO. Assume averages are equal to year-end balances where necessary. (Round answers to 2 decimal places, e.g. 52.75. Do not leave any field blank. Enter for the amounts if the answer is N/A.) 2020 2019 LIFO FIFO | In preparation for significant expansion of its international operations, Sheridan Co. has adopted a plan to gradually shift to the same accounting methods as used by its international competitors. Part of this plan includes a switch from LIFO inventory accounting to FIFO (recall that IFRS does not allow LIFO). Sheridan decides to make the switch to FIFO at January 1, 2020. The following data pertains to Sheridan's 2020 financial statements in millions of dollars). Sales Inventory purchases 12/31/20 inventory (using FIFO) Compensation expense $570 370 600 19 All sales and purchases were with cash. All of 2020's compensation expense was paid with cash. (Ignore taxes.) Sheridan's property, plant, and equipment cost $420 million and has an estimated useful life of 10 years with no salvage value. Sheridan Co. reported the following for fiscal 2019 (in millions of dollars): SHERIDAN CO. BALANCE SHEET AT DECEMBER 31, 2019 2019 2018 Cash $ 383 $ 220 Common stock Inventory 520 500 Retained earnings Property, plant, and equipment 420 Accumulated depreciation (84) (42) Total assets $ 1,239 $ 1,098 Total equity 2019 $ 520 719 2018 $ 520 578 420 $ 1.239 $ 1.098 SHERIDAN CO. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2019 2019 Sales $ 520 Cost of goods sold (320) Depreciation expense (42) Compensation expense (17) Net income $ 141 Summary of Significant Accounting Policies Inventory: The company accounts for inventory by the LIFO method. The current cost of the company's inventory, which approximates FIFO, was $62 and $52 higher at the end of fiscal 2019 and 2018, respectively, than those reported in the balance sheet. Compute Sheridan's inventory turnover for 2019 and 2020 under both LIFO and FIFO. Assume averages are equal to year-end balances where necessary. (Round answers to 2 decimal places, e.g. 52.75. Do not leave any field blank. Enter for the amounts if the answer is N/A.) 2020 2019 LIFO FIFO |