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 Sheridans 2020 financial statements (in millions of dollars).

Sales		$570
Inventory purchases		370
12/31/20 inventory (using FIFO)		600
Compensation expense		19

All sales and purchases were with cash. All of 2020s compensation expense was paid with cash. (Ignore taxes.) Sheridans 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						2019			2018
Cash		$	383			$	220			Common stock		$	520		$	520
Inventory			520				500			Retained earnings			719			578
Property, plant, and equipment			420				420
Accumulated depreciation			(84	)			(42	)
Total assets		$	1,239			$	1,098			Total equity		$	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 companys 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.

Prepare Sheridans December 31, 2020, balance sheet and an income statement for the year ended December 31, 2020. In columns beside 2020s numbers, include 2019s numbers as they would appear in the 2020 financial statements for comparative purposes. (List Assets in order of liquidity.)

SHERIDAN CO. Balance Sheet

		2020		2019
		$		$

		$		$
		$

$

$

SHERIDAN CO. Income Statement

		2020		2019
		$		$

$

$

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List of Accounts

Compute Sheridans 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 0 for the amounts if the answer is N/A.)

		2020		2019
LIFO
FIFO

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