Question 11 The management of Ivanhoe Co., SA is reevaluating the appropriateness of using its present inventory cost flow method. They request your help in determining the results of operations for 2017 if either the FIFO method or the average-cost method had been used. For 2017, the accounting records show the following data. Inventories Beginning (13,900 units) 29,000 Ending (20,850 units) Purchases were made quarterly as follows. Purchases and Sales Total net sales (312,750 units) Total cost of goods purchased (319,700 units) 1,202,350 1,002,329 Quarter 1 2 3 4 Units 83,400 69,500 69,500 97,300 319,700 Unit Cost 2.92 3.12 3.22 3.27 Total Cost 243,528 216,840 223,790 318,171 1,002,329 Operating expenses were 149,400, and the company's income tax rate is 33%. Your answer is partially correct. Try again. Prepare comparative condensed income statements for 2017 under FIFO and average-cost. (Round per unit cost to 3 decimal places, e.g. 15.125 and final answers to o decimal places, e.g. 125.) IVANHOE CO., SA Condensed Income Statement For the Year Ended December 31, 2017 FIFO Average-cost Sales Revenues 1202350 1202350 Cost of Goods Sold Beginning Inventory 29000 29000 Cost of Goods Purchased 1002329 1002329 Cost of Goods Available for Sale 1031329 1031329 X Ending Inventory 68180 64427 X X Cost of Goods Sold 963150 966903 X Gross Profit 239201 235448 Operating Expenses 149400 149400 X Income before Income Taxes 89801 86048 Income Tax Expense 29634 28396 Net Income / (Loss) 60166 57652 LINK TO TEXT Your answer is correct. Which cost flow method (FIFO or average-cost) produces the more meaningful inventory amount for the statement of financial position? FIFO method produces the more meaningful inventory amount. LINK TO TEXT x Your answer is incorrect. Try again. Which cost flow method (FIFO or average cost) is more likely to approximate actual physical flow of the goods? Average-cost method is most likely to approximate actual physical flow. LINK TO TEXT x Your answer is incorrect. Try again. How much additional cash will be available for management under average-cost than under FIFO? -2514 Additional cash will be available for management