b. Assume that in 2020 New Girl, which had been using the average-cost method since beginning operations in 2017,changed to the FIFO method of pricing inventories. Prepare the journal entry necessary to record the change in 2020,and show net income reported for 2017, 2018, 2019, and 2020. Below is the net income of New Girl Instrument AG, a private company, computed under the two inventory methods usinga periodic system.FIFOP26,00030,00029,00034,000(Ignore tax considerations.)Average CostP23,00025,00027,00030.0002017201820192020Requireda. Assume that in 2020 New Girl decided to change from the FIFO method to the average-cost method of pricinginventories. Prepare the journal entry necessary for the change that took place during 2020, and show net incomereported for 2017, 2018, 2019, and 2020.

Weighted average method is a method of inventory valuation where unit cost of goods available is…

Below is the net income of New Girl Instrument AG, a private company, computed under the two inventory methods using a periodic system. Average Cost P23,000 25,000 27,000 30,000 FIFO P26,000 30,000 29,000 34,000 (Ignore tax considerations.) 2017 2018 2019 2020 Required a. Assume that in 2020 New Girl decided to change from the FIFO method to the average-cost method of pricing inventories. Prepare the journal entry necessary for the change that took place during 2020, and show net income reported for 2017, 2018, 2019, and 2020.

Below is the net income of New Girl Instrument AG, a private company, computed under the two inventory methods using a periodic system. Average Cost P23,000 25,000 27,000 30,000 FIFO P26,000 30,000 29,000 34,000 (Ignore tax considerations.) 2017 2018 2019 2020 Required a. Assume that in 2020 New Girl decided to change from the FIFO method to the average-cost method of pricing inventories. Prepare the journal entry necessary for the change that took place during 2020, and show net income reported for 2017, 2018, 2019, and 2020.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Macintosh Inc. changed from LIFO to the FIFO inventory costing method on January 1, 2021. Inventory values at the end of each year since the inception of the company are as follows: FIFO LIFO 2019 $200,000 $180,000 2020 400,000 360,000 Ignoring income tax considerations, prepare the entry, in good form, to report this accounting change. Show well-labeled calculations for journal entry amounts or a note why no entry is required
In 2024, the Barton and Barton Company changed its method of valuing inventory from the FIFO method to the average cost method. At December 31, 2023, B & B’s inventories were $32.2 million (FIFO). B & B’s records indicated that the inventories would have totaled $23.9 million at December 31, 2023, if determined on an average cost basis. Ignoring income taxes, what journal entry will B & B use to record the adjustment in 2024? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).
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2.2. During 2021, Gamma Ltd discovered that some of their products sold during 2020 were incorrectly included in inventory as 31 December 2020 at R6 500. Assume a tax rate of 30%. Assume that the prior period error effect is considered to be material. Gamma Ltd.'s accounting records are as follows: 2021 Sales Cost of sales Profit before tax 208 000 (173 500) 35 000 (10 500) 24 500 2020 147 000 (107 000) 40 000 (12 000) 28 000 Taxation Profit The profit for 2021 includes R13 500 for the error made in opening inventory Additional information: 2020 opening retained earnings was R40 000 and closing retained earnings was R68 000. Gamma's income tax rate was 30% in 2021 as well as in 2020. It had no other income or expenses. Gamma Ltd has R10 000 of share capital throughout 2020 and 2021, as well as retained earnings. REQUIRED: Disclose the effect of the error in the financial statements for the year ended 31 December 2021
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Blue Devil Inc. uses the LIFO inventory costing method for both tax reporting and financial reporting purposes. Blue Devil’s inventories are reported at $50 million on its balance sheet. In its footnotes, Blue Devil is required to report the amount at which inventories would have been reported under FIFO method. The difference between these two numbers is referred to as what? Group of answer choices LIFO holding gain LCM disclosures LIFO reserve LIFO liquidation
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