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Cash Beginning inventory Common stock Retained earnings $ 17,300 17,835 (205 @ $87) 14,500 20,635 The following five transactions occurred in Year 3: 1. First purchase (cash): 120 units @ $89 2. Second purchase (cash): 200 units @ $97 3. Sales (all cash): 355 units @ $198 4. Paid $16,900 cash for salaries expense 5. Paid cash for income tax at the rate of 25 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-1. Use a vertical model to show the Year 3 income statement under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) b-2. Use a vertical model to show the Year 3 balance sheet under FIFO, LIFO, and weighted average. (Hint. Record the events under an accounting equation before preparing the statements.) b-3. Use a vertical model to show the Year 3 statement of cash flows under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) Complete this question by entering your answers in the tabs below.

Cash Beginning inventory Common stock Retained earnings $ 17,300 17,835 (205 @ $87) 14,500 20,635 The following five transactions occurred in Year 3: 1. First purchase (cash): 120 units @ $89 2. Second purchase (cash): 200 units @ $97 3. Sales (all cash): 355 units @ $198 4. Paid $16,900 cash for salaries expense 5. Paid cash for income tax at the rate of 25 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-1. Use a vertical model to show the Year 3 income statement under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) b-2. Use a vertical model to show the Year 3 balance sheet under FIFO, LIFO, and weighted average. (Hint. Record the events under an accounting equation before preparing the statements.) b-3. Use a vertical model to show the Year 3 statement of cash flows under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) Complete this question by entering your answers in the tabs below.

FINANCIAL ACCOUNTING
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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Chapter 5 Assignment 1 cBook Print References Cash Beginning inventory Common stock Retained earnings The following five transactions occurred in Year 3: 1. First purchase (cash): 120 units @ $89 2. Second purchase (cash): 200 units @ $97 3. Sales (all cash): 355 units @ $198 4. Paid $16,900 cash for salaries expense 5. Paid cash for income tax at the rate of 25 percent of income before taxes $ 17,300 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-1. Use a vertical model to show the Year 3 income statement under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) b-2. Use a vertical model to show the Year 3 balance sheet under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) b-3. Use a vertical model to show the Year 3 statement of cash flows under FIFO, LIFO, and weighted average. (Hint. Record the events under an accounting equation before preparing the statements.) Req A Complete this question by entering your answers in the tabs below. Req B1 17,835 (205 $87) 14,500 20,635 Cash flows from operating activities Ending cash balance Req B2 Use a vertical model to show the Year 3 statement of cash flows under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) Note: Do not round intermediate calculations. Round your answers to nearest whole dollar amount. Cash outflows should be indicated by a minus sign. Net cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Net change in cash Req 83 WALL'S CHINA SHOP Statements of Cash Flows For the Year Ended December 31, Year 3 FIFO LIFO Weighted Average Show less A
Transcribed Image Text:Chapter 5 Assignment 1 cBook Print References Cash Beginning inventory Common stock Retained earnings The following five transactions occurred in Year 3: 1. First purchase (cash): 120 units @ $89 2. Second purchase (cash): 200 units @ $97 3. Sales (all cash): 355 units @ $198 4. Paid $16,900 cash for salaries expense 5. Paid cash for income tax at the rate of 25 percent of income before taxes $ 17,300 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-1. Use a vertical model to show the Year 3 income statement under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) b-2. Use a vertical model to show the Year 3 balance sheet under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) b-3. Use a vertical model to show the Year 3 statement of cash flows under FIFO, LIFO, and weighted average. (Hint. Record the events under an accounting equation before preparing the statements.) Req A Complete this question by entering your answers in the tabs below. Req B1 17,835 (205 $87) 14,500 20,635 Cash flows from operating activities Ending cash balance Req B2 Use a vertical model to show the Year 3 statement of cash flows under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.) Note: Do not round intermediate calculations. Round your answers to nearest whole dollar amount. Cash outflows should be indicated by a minus sign. Net cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Net change in cash Req 83 WALL'S CHINA SHOP Statements of Cash Flows For the Year Ended December 31, Year 3 FIFO LIFO Weighted Average Show less A
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