Final Inventory 2020 2021 FIFO $580000 $ 672000 LIFO 550000 656000 Net Income (computed under the FIFO method) 1080000 1310000 The company deems it impracticable to apply the retrospective approach. Based on the above information, a change to the LIFO method in 2021 would result in net income for 2021 of $1294000. $1280000. $1080000. $1310000.
Final Inventory 2020 2021 FIFO $580000 $ 672000 LIFO 550000 656000 Net Income (computed under the FIFO method) 1080000 1310000 The company deems it impracticable to apply the retrospective approach. Based on the above information, a change to the LIFO method in 2021 would result in net income for 2021 of $1294000. $1280000. $1080000. $1310000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Wildhorse Company began operations on January 1, 2020, and uses the FIFO method in costing its raw material inventory. Management is contemplating a change to the LIFO method and is interested in determining what effect such a change will have on net income. Accordingly, the following information has been developed:
The company deems it impracticable to apply the retrospective approach. Based on the above information, a change to the LIFO method in 2021 would result in net income for 2021 of
| Final Inventory | 2020 | 2021 | ||
| FIFO | $580000 | $ 672000 | ||
| LIFO | 550000 | 656000 | ||
| Net Income (computed under the FIFO method) | 1080000 | 1310000 |
The company deems it impracticable to apply the retrospective approach. Based on the above information, a change to the LIFO method in 2021 would result in net income for 2021 of
$1294000.
$1280000.
$1080000.
$1310000.
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