Orion Iron Corporation tracks the number of units purchased and sold throughout each year but applies its inventory costing method at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at the end of the annual accounting period, December 31. Transactions a. Inventory, Beginning For the year: b. Purchase, April 11 c. Purchase, June 1 d. Sale, May 1 (sold for $43 per unit) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 e. Sale, July 3 (sold for $43 per unit) f. Operating expenses (excluding income tax expense), $19,400 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost. 4. Prepare an income statement that shows under the FIFO method, LIFO method and weighted average method. 6. Which inventory costing method minimizes income taxes? Required 4 Required 6 Calculate the number and cost of goods available for sale. Number of Goods Available for Sale Units 300 units 800 700 300 650 Unit Cost $ 15 13 16
Orion Iron Corporation tracks the number of units purchased and sold throughout each year but applies its inventory costing method at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at the end of the annual accounting period, December 31. Transactions a. Inventory, Beginning For the year: b. Purchase, April 11 c. Purchase, June 1 d. Sale, May 1 (sold for $43 per unit) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 e. Sale, July 3 (sold for $43 per unit) f. Operating expenses (excluding income tax expense), $19,400 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost. 4. Prepare an income statement that shows under the FIFO method, LIFO method and weighted average method. 6. Which inventory costing method minimizes income taxes? Required 4 Required 6 Calculate the number and cost of goods available for sale. Number of Goods Available for Sale Units 300 units 800 700 300 650 Unit Cost $ 15 13 16
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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![Orion Iron Corporation tracks the number of units purchased and sold throughout each year but applies its inventory costing method
at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at
the end of the annual accounting period, December 31.
Transactions
a. Inventory, Beginning
For the year:
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
b. Purchase, April 11
c. Purchase, June 1
d. Sale, May 1 (sold for $43 per unit)
e. Sale, July
(sold for $43 per unit)
f. Operating expenses (excluding income tax expense), $19,400
Required:
1. Calculate the number and cost of goods available for sale.
2. Calculate the number of units in ending inventory.
3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost.
4. Prepare an income statement that shows under the FIFO method, LIFO method and weighted average method.
6. Which inventory costing method minimizes income taxes?
Required 3 Required 4 Required 6
Calculate the number and cost of goods available for sale.
Number of Goods Available for Sale
Units
300
units
800
700
300
650
Unit Cost
$15
13
16](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F43a571d1-8225-4ee6-aef4-3d39097cd37c%2F8020ee82-6b54-4694-aa41-311d721b1c75%2Fid6wkam_processed.png&w=3840&q=75)
Transcribed Image Text:Orion Iron Corporation tracks the number of units purchased and sold throughout each year but applies its inventory costing method
at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at
the end of the annual accounting period, December 31.
Transactions
a. Inventory, Beginning
For the year:
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
b. Purchase, April 11
c. Purchase, June 1
d. Sale, May 1 (sold for $43 per unit)
e. Sale, July
(sold for $43 per unit)
f. Operating expenses (excluding income tax expense), $19,400
Required:
1. Calculate the number and cost of goods available for sale.
2. Calculate the number of units in ending inventory.
3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost.
4. Prepare an income statement that shows under the FIFO method, LIFO method and weighted average method.
6. Which inventory costing method minimizes income taxes?
Required 3 Required 4 Required 6
Calculate the number and cost of goods available for sale.
Number of Goods Available for Sale
Units
300
units
800
700
300
650
Unit Cost
$15
13
16
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VIEWStep 4: Cost of goods sold and Ending inventory calculation under LIFO Method:
VIEWStep 5: Cost of goods sold and Ending inventory calculation under Average cost Method:
VIEWStep 6: Preparing Income Statements:
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