a. Compute the gross margin for Mason Company using the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. b. What is the amount of net income using FIFO, LIFO, and weighted average? (Ignore income tax considerations.) c. Determine the cash flow from operating activities, using each of the three cost flow assumptions listed in Requirement a. Ignore the effect of income taxes.
a. Compute the gross margin for Mason Company using the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. b. What is the amount of net income using FIFO, LIFO, and weighted average? (Ignore income tax considerations.) c. Determine the cash flow from operating activities, using each of the three cost flow assumptions listed in Requirement a. Ignore the effect of income taxes.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The following information pertains to Mason Company for Year 2:
Beginning inventory.
Units purchased
90 units
300 units
Ending inventory consisted of 20 units. Mason sold 370 units at $50 each. All purchases and sales were made with cash. Operating
expenses amounted to $3600.
Required
@ $20
@ $25
a. Compute the gross margin for Mason Company using the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted
average.
b. What is the amount of net income using FIFO, LIFO, and weighted average? (Ignore income tax considerations.)
c. Determine the cash flow from operating activities, using each of the three cost flow assumptions listed in Requirement a. Ignore the
effect of income taxes.
Complete this question by entering your answers in the tabs below.
Required A Required B
Compute the gross margin for Mason Company using the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3)
weighted average. (Round "Cost per unit" to 2 decimal places and final answers to nearest whole dollar amount.)
Required C
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