Assume that the company had switched from the average cost method to the FIFO method with net income on an average cost basis for the four years as follows: 2019, $80,400; 2020, $86,120; 2021, $90,300; and 2018, $93,600. Indicate the net income that would be show
Assume that the company had switched from the average cost method to the FIFO method with net income on an average cost basis for the four years as follows: 2019, $80,400; 2020, $86,120; 2021, $90,300; and 2018, $93,600. Indicate the net income that would be show
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In 2022, Kimberly Corporation changed its method of inventory pricing from LIFO to FIFO. Net income computed on a LIFO as compared to a FIFO basis for the four years involved is: (Ignore income taxes.)
| LIFO | FIFO | |||
| 2019 | $78,600 | $87,400 | ||
| 2020 | 84,000 | 88,900 | ||
| 2021 | 86,800 | 90,600 | ||
| 2022 | 92,800 | 92,200 |
Assume that the company had switched from the average cost method to the FIFO method with net income on an average cost basis for the four years as follows: 2019, $80,400; 2020, $86,120; 2021, $90,300; and 2018, $93,600. Indicate the net income that would be shown on comparative financial statements issued at 12/31/22 for each of the four years under these conditions.
|
Net Income
|
||
| 2019 | $ | |
| 2020 | $ | |
| 2021 | $ | |
| 2022 | $ |
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