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Presented below are income statements prepared on a LIFO and FIFO basis for Bonita Company, which started operations on January 1, 2019. The company presently

Presented below are income statements prepared on a LIFO and FIFO basis for Bonita Company, which started operations on January 1, 2019. The company presently uses the LIFO method of pricing its inventory and has decided to switch to the FIFO method in 2020. The FIFO income statement is computed in accordance with the requirements of GAAP. Bonitas profit-sharing agreement with its employees indicates that the company will pay employees 10% of income before profit-sharing. Income taxes are ignored.

LIFO Basis

FIFO Basis

2020

2019

2020

2019

Sales

$3,150 $3,150 $3,150 $3,150

Cost of goods sold

1,160 1,010 1,090 950

Operating expenses

1,040 1,040 1,040 1,040

Income before profit-sharing

950 1,100 1,020 1,160

Profit-sharing expense

95 110 108 110

Net income

$855 $990 $912 $1,050
Answer the following questions.
If comparative income statements are prepared, what net income should Bonita report in 2019 and 2020? (Round answers to 0 decimal places, e.g. 125.)

2020

2019

Net income

$enter a dollar amount rounded to 0 decimal places

$enter a dollar amount rounded to 0 decimal places

Assume that Bonita has a beginning balance of retained earnings at January 1, 2020, of $990 using the LIFO method. The company declared and paid dividends of $510 in 2020. Prepare the retained earnings statement for 2020, assuming that Bonita has switched to the FIFO method. (Round answers to 0 decimal places, e.g. 125.)

BONITA COMPANY Retained Earnings Statement

select an opening name

Cumulative Effect of Change to FIFODividendsNet IncomeRetained Earnings, January 1, as adjustedRetained Earnings, January 1, as reportedRetained Earnings, December 31

$enter a dollar amount

select an item

Cumulative Effect of Change to FIFODividendsNet IncomeRetained Earnings, January 1, as adjustedRetained Earnings, January 1, as reportedRetained Earnings, December 31

enter a dollar amount

select a summarizing line for the first part

Cumulative Effect of Change to FIFODividendsNet IncomeRetained Earnings, January 1, as adjustedRetained Earnings, January 1, as reportedRetained Earnings, December 31

enter a total amount for the first part

select between addition and deduction

AddLess

: select an item

Cumulative Effect of Change to FIFODividendsNet IncomeRetained Earnings, January 1, as adjustedRetained Earnings, January 1, as reportedRetained Earnings, December 31

enter a dollar amount

select between addition and deduction

AddLess

: select an item

Cumulative Effect of Change to FIFODividendsNet IncomeRetained Earnings, January 1, as adjustedRetained Earnings, January 1, as reportedRetained Earnings, December 31

enter a dollar amount

select a closing name

Cumulative Effect of Change to FIFODividendsNet IncomeRetained Earnings, January 1, as adjustedRetained Earnings, January 1, as reportedRetained Earnings, December 31

$enter a total amount

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