Tableau DA 6-4: Mlnl-Case, Perpetual: Income effects of LIFO and FIFO LO A1 ATV Co. began operations on March 1 and uses a perpetual inventory system. It entered into purchases and sales for March as shown in the Tableau Dashboard. March Sunday Monday Tuesday Wednesday Thursday Friday Saturday Legend No Purchases or Sales Purchases Sales 1 2 tableau > TO 1. The CEO has asked you to help her decide whether to use LIFO or FIFO for inventory costing. Compute the gross profit earned by the company for both LIFO and FIFO. 2. The CEO's bonus is calculated using net income before income taxes. If the CEO wishes to maximize her bonus, which of the following methods would you recommend? 3. Alternatively, the CEO desires the method that minimizes income taxes paid by the company in the current year. If income taxes are based on a percentage of net income, which method would you recommend to the CEO? Complete this question by entering your answers in the tabs below. Required 1 FIFO Required 1 LIFO Required 1 Gross Profit Required 2 Required 3 The CEO has asked you to help her decide whether to use UFO or FIFO for inventory costing. Compute the gross profit earned by the company for both LIF Perpetual FIFO: Inventory Balance Cost of Goods Sold Goods Purchased # of units sold Cost of Goods Sold Cost per unit # of units Cost per unit Inventory Balance Cost per unit Date # of units 100 100 @ $ 50.00 $ 5.000.00 March 1 50.00 @ March 5 Perpetual FIFO: Goods Purchased Cost of Goods Sold Inventory Balance Date units Cost per unit # of units sold Cost per unit Cost of Goods Sold # of units Cost per unit Inventory Balance March 1 100 $ 50.00 100 $ 50.00 = $ 5,000.00 March 5 March 9 March 18 es March 25 March 29 0.00 $ 0.00 Totals Required 1 FIFO Required 1 LIFO Required 1 Gross Profit Required 2 Required 3 The CEO has asked you to help her decide whether to use UFO or FIFO for inventory costing. Compute the gross profit earned by the company for both LIFO and FIFO. Perpetual LIFO: Goods Purchased Cost of Goods Sold Inventory Balance Date # of units Cost per Cost per unit of units sold Cost of Goods Sold # of units Cost per unit Inventory Balance Nlanch 1 Ta 50.00 100 $ 50.00 $ 5.000.00 March 5 March 9 Nanchas March 2:5 Perpetual UFO: Goods Purchased most of Good Gold inventory Balance Date # of units cost per Cost per unit # of units sold Dogtor Goods Sold of units cost per unit Inventory Balance unit March 1 100 $ 50.00 100 00 ES 50.00 = $ 5.000.00 March 5 March 9 Narch 18 March 25 March 29 000 March Sunday Monday Tuesday Wednesday Thursday Friday Saturday Legend No Purchases or Sales Purchases Sales 1 2 3 5 6 7 00 10 11 12 13 14. 15 16 17 18 19 20 21 22 23 25 26 28 27 24 29 30 March Wednesday Thursday Friday Saturday purchase 100 m 690eaan 4 March 1 2 4 M 1 5 1 March Wednesday Thursday Friday Saturday 2 6 Sa es 420 units $85each GT 18 ch 1 - SC 24 2) 18 21 N 24 25 27 29 Purchase 200 units 31 20 30