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Inventory Count, December 31 Inventory, January 1 3 at $1,040 9 at 5 at 240 6 at 6 at Model 1st 2nd 3rd 3 at $1,054 7 at 3 at $1,060 3 at $1,070 6 at 1 at C55 4 D11 639 645 666 6 at 675 11 F32 3 at 260 260 1 at 280 H29 305 3 at 310 3 at 316 4 at 317 К47 520 8 at 531 4 at 549 6 at 542 8. $33 4 at 222 4 at 232 - X74 4 at 35 б at 36 8 at 37 7 at 39 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. Present data in columnar form, using the following headings: Model Quantity Unit Cost Total Cost If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method, following the procedures indicated in (1). 3. Determine the cost of the inventory on December 31 by the weighted average cost method, using the columnar headings indicated in (1). Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices (b) declining prices

Inventory Count, December 31 Inventory, January 1 3 at $1,040 9 at 5 at 240 6 at 6 at Model 1st 2nd 3rd 3 at $1,054 7 at 3 at $1,060 3 at $1,070 6 at 1 at C55 4 D11 639 645 666 6 at 675 11 F32 3 at 260 260 1 at 280 H29 305 3 at 310 3 at 316 4 at 317 К47 520 8 at 531 4 at 549 6 at 542 8. $33 4 at 222 4 at 232 - X74 4 at 35 б at 36 8 at 37 7 at 39 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. Present data in columnar form, using the following headings: Model Quantity Unit Cost Total Cost If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method, following the procedures indicated in (1). 3. Determine the cost of the inventory on December 31 by the weighted average cost method, using the columnar headings indicated in (1). Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices (b) declining prices

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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Inventory Count, December 31 Inventory, January 1 3 at $1,040 9 at 5 at 240 6 at 6 at Model 1st 2nd 3rd 3 at $1,054 7 at 3 at $1,060 3 at $1,070 6 at 1 at C55 4 D11 639 645 666 6 at 675 11 F32 3 at 260 260 1 at 280 H29 305 3 at 310 3 at 316 4 at 317 К47 520 8 at 531 4 at 549 6 at 542 8. $33 4 at 222 4 at 232 - X74 4 at 35 б at 36 8 at 37 7 at 39 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. Present data in columnar form, using the following headings: Model Quantity Unit Cost Total Cost If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method, following the procedures indicated in (1). 3. Determine the cost of the inventory on December 31 by the weighted average cost method, using the columnar headings indicated in (1). Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices (b) declining prices
Transcribed Image Text:Inventory Count, December 31 Inventory, January 1 3 at $1,040 9 at 5 at 240 6 at 6 at Model 1st 2nd 3rd 3 at $1,054 7 at 3 at $1,060 3 at $1,070 6 at 1 at C55 4 D11 639 645 666 6 at 675 11 F32 3 at 260 260 1 at 280 H29 305 3 at 310 3 at 316 4 at 317 К47 520 8 at 531 4 at 549 6 at 542 8. $33 4 at 222 4 at 232 - X74 4 at 35 б at 36 8 at 37 7 at 39 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. Present data in columnar form, using the following headings: Model Quantity Unit Cost Total Cost If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method, following the procedures indicated in (1). 3. Determine the cost of the inventory on December 31 by the weighted average cost method, using the columnar headings indicated in (1). Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices (b) declining prices
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