The accounting records of Wall's China Shop reflected the following balances as of January 1, Year 2:

Cash	$	19,000
Beginning inventory		12,900	(150 units @ $86)
Common stock		14,500
Retained earnings		17,400

The following five transactions occurred in Year 2:

1. First purchase (cash) 115 units @ $88
2. Second purchase (cash) 195 units @ $96
3. Sales (all cash) 415 units @ $191
4. Paid $13,300 cash for salaries expenses.
5. Paid cash for income tax at the rate of 40 percent of income before taxes.

Required a. Compute the cost of goods sold and ending inventory, assuming (1) FIFO cost flow, (2) LIFO cost flow, and (3) weighted-average cost flow. Compute the income tax expense for each method. b. Record the above transactions in general journal form and post to T-accounts assuming (1) FIFO cost flow, (2) LIFO cost flow, and (3) weighted-average cost flow. Assume perpetual inventory system is used. 1. FIFO 2. LIFO 3. Weighted Average c. Use a vertical model to show the Year 2 income statement, balance sheet, and statement of cash flows under FIFO, LIFO, and weighted average.

Compute the cost of goods sold and ending inventory, assuming (1) FIFO cost flow, (2) LIFO cost flow, and (3) weighted-average cost flow. Compute the income tax expense for each method. (Round intermediate calculations to 3 decimal places. Round your final answers to the nearest whole dollar amount.)

	Cost of Goods Sold	Ending Inventory
FIFO
LIFO
Weighted Average
WALL's CHINA SHOP
Computation of Income Tax Expense and Net Income
	FIFO	LIFO	Weighted Average
	0	0	0
	0	0	0
	$0	$0	$0

Record the above transactions in general journal form assuming FIFO cost flow. Assume perpetual inventory system is used. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round intermediate calculations to 3 decimal places. Round your final answers to the nearest whole dollar amount.)

Journal entry worksheet

• Record entry merchandise inventory purchased for cash.

Note: Enter debits before credits.

Event	General Journal	Debit	Credit
01

Record the above transactions in post to T-accounts assuming FIFO cost flow. Assume perpetual inventory system is used. (Round intermediate calculations to 3 decimal places. Round your final answers to the nearest whole dollar amount.)

Cash					Merchandise Inventory
Beg. Bal					Beg. Bal
					End. Bal
End. Bal
Common Stock					Retained Earnings
Beg. Bal					Beg. Bal
End. Bal					End. Bal
Sales Revenue					Cost of Goods Sold
Beg. Bal					Beg. Bal
End. Bal					End. Bal
Salaries Expense					Income Tax Expense
Beg. Bal					Beg. Bal
End. Bal					End. Bal