Cullumber Inc. began operations on January 1, 2023, and uses the FIFO method of pricing inventory. Management is contemplating achange in inventory methods for 2026. The following information is available for the years 2023-2025:202320242025(a)Net Income Computed Using:FIFO MethodAverage-Cost Method$109,00070,000146,000$120,000Account Titles and Explanation79,000167,000LIFO Method$79,00051,000130,000Prepare the journal entry necessary to record a change from the FIFO method to the average cost method in 2026. (Ignore taxconsiderations.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry isrequired, select "No Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.)DebitCredit

Name: Cullumber Inc. began operations on January 1, 2023, and uses the FIFO
Uploaded: 2024-03-20T06:32:37.000Z
Channel: Bartleby
Description: Cullumber Inc. began operations on January 1, 2023, and uses the FIFO method of pricing inventory. Management is contemplating achange in inventory methods for 2026. The following information is available for the years 2023-2025:202320242025(a)Net I

Business

Accounting

Cullumber Inc. began operations on January 1, 2023, and uses the FIFO method of pricing inventory. Management is contemplating a change in inventory methods for 2026. The following information is available for the years 2023-2025: 2023 2024 2025 Net Income Computed Using: Average-Cost Method $109,000 70,000 146,000 FIFO Method $120,000 79,000 167,000 LIFO Method $79,000 51,000 130,000

Cullumber Inc. began operations on January 1, 2023, and uses the FIFO method of pricing inventory. Management is contemplating a change in inventory methods for 2026. The following information is available for the years 2023-2025: 2023 2024 2025 Net Income Computed Using: Average-Cost Method $109,000 70,000 146,000 FIFO Method $120,000 79,000 167,000 LIFO Method $79,000 51,000 130,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Presented below is information related to Blossom Company. December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 December 31, 2026 December 31, 2027 2022 Date 2023 2024 2025 2026 2027 Ending Inventory (End-of-Year Prices) $ $73,000 116,596 113,988 127,889 153,303 185,026 Compute the ending inventory for Blossom Company for 2022 through 2027 using the dollar-value LIFO method. Ending Inventory 73000 117904 113518.56 131642.27 162706.18 Price Index 198349.66 100 103 118 127 137 142
2
Presented below is information related to Bonita Company. Price Index Date December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 December 31, 2026 December 31, 2027 2022 2023 2024 2025 2026 2027 $ $ Ending Inventory (End-of-Year Prices) $ $78,300 115,154 114,696 Compute the ending inventory for Bonita Company for 2022 through 2027 using the dollar-value LIFO method. 128,651 152,755 182,044 Ending Inventory 78300 112805 112800 118012 131986 100 155700 103 118 127 137 142
Presented below is information related to Riverbed Corporation. Inventory on December 31, 2025, when dollar-value LIFO is adopted Inventory, December 31, 2026 Price Index 100 105 LIFO Cost $45,600 ? Retail $82,100 97.755 Compute the ending inventory under the dollar-value LIFO method at December 31, 2026. The cost-to-retail ratio for 2026 was 50% Ending inventory under the dollar-value LIFO method at December 31, 2026 $
Early in 2022, A company switched to a just in time inventory system. its sales and inventory amounts for 2021 and 2022 are shown below. 2021 2022 Sales Revenue. 3220000 3840000 Cost of Goods sold 1406250 1728000 Begining inventory. 150000 225000 Ending inventory 225000 95000 Determine the inventory turnover for 2021 and 2022
Taylor Company uses a periodic inventory system. The following is partial information from its income statements for 2019 and 2020: 2019 2020 Beginning inventory $ (b) $ (d) Sales 250,000 (f) Purchases 120,000 140,000 Purchase returns 2,000 3,000 Ending inventory 45,000 70,000 Gross profit (a) 88,000 Cost of goods sold 111,000 (e) Expenses 70,000 62,000 Net income (c) 26,000 Required Fill in the blanks lettered a through f. (Hint: It probably is easiest to work through the blanks according to the sequential letters.) (a) Gross profit (b) Beginning inventory (c) Net income (d) Beginning inventory of 2020 (e) Cost of goods sold (f) Sales
On January 1, 2018, the Taylor Company adopted the dollar-value LIFO method. The inventory value for its one inventory pool on this date was $310,000. Inventory data for 2018 through 2020 are as follows: Date Ending Inventoryat Year-End Costs Cost Index 12/31/2018 $339,900 1.03 12/31/2019 382,950 1.11 12/31/20 398,650 1.19 Compute: Compute Taylor's ending inventory for 2018, 2019, and 2020.
Hogan Industries had the following inventory transactions occur during 2022: Units Cost/unit Feb. 1, 2022 Purchase 108 $45 Mar. 14, 2022 Purchase 186 $47 May 1, 2022 Purchase 132 $49 The company sold 306 units at $63 each and has a tax rate of 30%. Assuming that a periodic inventory system is used, what is the company’s gross profit using LIFO? (rounded to whole dollars)
The Cecil-Booker Vending Company changed its method of valuing inventory from the average cost method to the FIFO cost method at the beginning of 2024. At December 31, 2023, inventories were $122,000 (average cost basis) and were $126,000 a year earlier. Cecil-Booker's accountants determined that the inventories would have totaled $159,000 at December 31, 2023, and $164,000 at December 31, 2022, if determined on a FIFO basis. A tax rate of 25% is in effect for all years. One hundred thousand common shares were outstanding each year. Income from continuing operations was $420,000 in 2023 and $545,000 in 2024. There were no discontinued operations either year. Required: 1. Prepare the journal entry at January 1, 2024, to record the change in accounting principle. (All tax effects should be reflected in the deferred tax liability account.) 2. Prepare the 2024-2023 comparative income statements beginning with income from continuing operations (adjusted for any revisions). Include per share…
On January 1, 2024, a company adopted the dollar-value LIFO method. The inventory value for its one inventory pool on this date was $400,000. Inventory data for 2024 through 2026 are as follows: Ending Inventory at Date Year-End Costs 12/31/2024 12/31/2025 12/31/2026 $ 441,000 487,200 510,000 Required: Cost Index 1.05 1.12 1.20 Calculate the company's ending inventory for 2024, 2025, and 2026. Inventory Layers Converted to Cost Inventory Layers Converted to Base Year Cost Date Inventory at Year-End Year-End Cost Cost Index 01/01/2024 12/31/2024 Inventory Layers at Base Inventory Layers Converted to Cost Inventory Layers at Base Year Year-End Cost Index Year Cost Cost II = Base II = || Base = 2024 = 12/31/2025 = Base = 2024 II II = 2025 12/31/2026 = Base 2024 2025 = || ||| || | || 2026 = Inventory DVL Cost
Gadubhai
A company reports inventory and cost of goods sold based on calculations from a LIFO periodic inventory system. The company’s records under this system reveal the following inventory layers at the beginning of 2024 (listed in chronological order of acquisition): 19,500 units @ $10 $ 195,000 24,500 units @ $15 367,500 Beginning inventory $ 562,500 During 2024, 49,000 units were purchased for $20 per unit. Due to unexpected demand for the company's product, 2024 sales totaled 60,000 units at various prices, leaving 33,000 units in ending inventory. Calculate the amount to report for cost of goods sold for 2024. Determine the amount of LIFO liquidation profit that the company must report in a disclosure note to its 2024 financial statements. Assume an income tax rate of 25%. If the company decided to purchase an additional 11,000 units at $20 per unit at the end of the year, how much income tax currently payable would be saved?