Question
Problem 6-4A The management of Tinker Inc. asks your help in determining the comparative effects of the FIFO and LIFO inventory cost flow methods. For
Problem 6-4A
The management of Tinker Inc. asks your help in determining the comparative effects of the FIFO and LIFO inventory cost flow methods. For 2014, the accounting records show these data.
| Inventory, January 1 (10,000 units) | $ 36,000 | |
| Cost of 120,000 units purchased | 470,820 | |
| Selling price of 97,700 units sold | 750,000 | |
| Operating expenses | 127,200 | |
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Units purchased consisted of 34,900 units at $3.70 on May 10; 60,600 units at $3.90 on August 15; and 24,500 units at $4.30 on November 20. Income taxes are 30%.
(a) Prepare comparative condensed income statements for 2014 under FIFO and LIFO.
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, and Terry D. Warfield
15th edition
978-1118159644, 9781118562185, 1118159640, 1118147294, 978-1118147290
