Exercise 5-19A (Algo) Effect of inventory cost flow (FIFO, LIFO, and weighted average) on gross margin LO 5-6 The following information pertains to Mason Company for Year 2: Beginning inventory" Units purchased 150 units 400 units $80 $82 Ending inventory consisted of 80 units. Mason sold 470 units at $164 each. All purchases and sales were made with cash. Operating expenses amounted to $4300. Required 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.
Exercise 5-19A (Algo) Effect of inventory cost flow (FIFO, LIFO, and weighted average) on gross margin LO 5-6 The following information pertains to Mason Company for Year 2: Beginning inventory" Units purchased 150 units 400 units $80 $82 Ending inventory consisted of 80 units. Mason sold 470 units at $164 each. All purchases and sales were made with cash. Operating expenses amounted to $4300. Required 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.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 62E
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