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The management of Bonita Inc. is reevaluating the appropriateness of using its present inventory cost flow method, which is average- cost. The company requests
The management of Bonita Inc. is reevaluating the appropriateness of using its present inventory cost flow method, which is average- cost. The company requests your help in determining the results of operations for 2022 if either the FIFO or the LIFO method had been used. For 2022, the accounting records show these data: Inventories Purchases and Sales Beginning (6,000 units) $24,000 Total net sales (182,000 units) $1,119,300 Ending (14,000 units) Total cost of goods purchased (190,000 units) 846,000 Purchases were made quarterly as follows. Quarter Units Unit Cost Total Cost 1 50,000 $4.20 $210,000 2 40,000 4.35 174,000 3 40,000 4.50 180,000 4 60,000 4.70 282,000 190,000 $846,000 Operating expenses were $125,000, and the company's income tax rate is 40%.
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