Goddard Company has used the FIFO method of inventory valustion since it began operations in 2018. Goddard decided to change to the overage cost method for determining inventory costs at the beginning of 2021. The following schedule shows year-end inventory balances under the FIFO and average cost methods: Average Cost $55,480 Year FIFO 2018 $45, 70 2019 se, 100 71,780 80, 180 2020 Required: 1. Ignoring income taxes, prepare the 2021 journal entry to adjust the accounts to refiect the average cost method. 2 How much higher or lower would cost of goods sold be in the 2020 revised income statement? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Ignoring income taxes, prepare the 2021 journal entry to adjust the accounts to reflect the average cost method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction ilst Journal entry worksheet 1 Record the adjustment necessary to reflect the average cost method. Note: Enter debits before credits. Event General Journal Debit Credit
Goddard Company has used the FIFO method of inventory valustion since it began operations in 2018. Goddard decided to change to the overage cost method for determining inventory costs at the beginning of 2021. The following schedule shows year-end inventory balances under the FIFO and average cost methods: Average Cost $55,480 Year FIFO 2018 $45, 70 2019 se, 100 71,780 80, 180 2020 Required: 1. Ignoring income taxes, prepare the 2021 journal entry to adjust the accounts to refiect the average cost method. 2 How much higher or lower would cost of goods sold be in the 2020 revised income statement? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Ignoring income taxes, prepare the 2021 journal entry to adjust the accounts to reflect the average cost method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction ilst Journal entry worksheet 1 Record the adjustment necessary to reflect the average cost method. Note: Enter debits before credits. Event General Journal Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Goddard Compsny has used the FIFO method of inventory valustion since it began operations in 2018. Goddard decided to change to
the average cost method for determining inventory costs at the beginning of 2021. The following schedule shows year-end inventory
balances under the FIFO and average cost methods:
Year
FIFD
Average Cost
$55,400
2018 $45, 70
2019
se,100
85, 800
71,7e0
se, 100
2020
Required:
1. Ignoring income taxes, prepare the 2021 journal entry to sdjust the accounts to refiect the average cost method.
2 How much higher or lower would cost of goods sold be in the 2020 revised income statement?
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Ignoring income taxes, prepare the 2021 journal entry to adjust the accounts to reflect the average cost method. (Ir no entry is required
ror a transaction/event, select "No journal entry required" in the first account field.)
View trannaction llat
Journal entry worksheet
Record the adjustment necessary to reflect the average cost method.
Note: Enter debits before credits.
Event
General Journal
Debit
Credit
Record entry
Clвar entry
Vlew general Jourmal
Required 1
Required 2 >](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3cadaab7-0242-405d-ab75-d1a15c225b30%2F00aecfe8-5587-418b-b565-fa2a7212bcb4%2Fjrhs9z_processed.png&w=3840&q=75)
Transcribed Image Text:Goddard Compsny has used the FIFO method of inventory valustion since it began operations in 2018. Goddard decided to change to
the average cost method for determining inventory costs at the beginning of 2021. The following schedule shows year-end inventory
balances under the FIFO and average cost methods:
Year
FIFD
Average Cost
$55,400
2018 $45, 70
2019
se,100
85, 800
71,7e0
se, 100
2020
Required:
1. Ignoring income taxes, prepare the 2021 journal entry to sdjust the accounts to refiect the average cost method.
2 How much higher or lower would cost of goods sold be in the 2020 revised income statement?
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Ignoring income taxes, prepare the 2021 journal entry to adjust the accounts to reflect the average cost method. (Ir no entry is required
ror a transaction/event, select "No journal entry required" in the first account field.)
View trannaction llat
Journal entry worksheet
Record the adjustment necessary to reflect the average cost method.
Note: Enter debits before credits.
Event
General Journal
Debit
Credit
Record entry
Clвar entry
Vlew general Jourmal
Required 1
Required 2 >
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