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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: b. Purchase, April 11 c. Purchase, June 1 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 d. Sale, May 1 (sold for $47 per unit) e. Sale, July 3 (sold for $47 per unit) f. Operating expenses (excluding income tax expense), $18,700 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 and (b) LIFO 4. Prepare an income statement that shows under the FIFO method and LIFO method 5. Which inventory costing method minimizes income taxes? Required 4 Required 5 Which inventory costing method minimizes income taxes? OFIFO OLIFO Units 300 < Required 4 900 800 300 680 Unit Cost $19 Required 5 > 17 20

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 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 d. Sale, May 1 (sold for $47 per unit) e. Sale, July 3 (sold for $47 per unit) f. Operating expenses (excluding income tax expense), $18,700 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 and (b) LIFO 4. Prepare an income statement that shows under the FIFO method and LIFO method 5. Which inventory costing method minimizes income taxes? Required 4 Required 5 Which inventory costing method minimizes income taxes? OFIFO OLIFO Units 300 < Required 4 900 800 300 680 Unit Cost $19 Required 5 > 17 20

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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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 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 d. Sale, May 1 (sold for $47 per unit) e. Sale, July 3 (sold for $47 per unit) f. Operating expenses (excluding income tax expense), $18,700 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 and (b) LIFO 4. Prepare an income statement that shows under the FIFO method and LIFO method 5. Which inventory costing method minimizes income taxes? Required 4 Required 5 Which inventory costing method minimizes income taxes? OFIFO OLIFO Units 300 < Required 4 900 800 300 680 Unit Cost $19 Required 5 > 17 20
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: b. Purchase, April 11 c. Purchase, June 1 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 d. Sale, May 1 (sold for $47 per unit) e. Sale, July 3 (sold for $47 per unit) f. Operating expenses (excluding income tax expense), $18,700 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 and (b) LIFO 4. Prepare an income statement that shows under the FIFO method and LIFO method 5. Which inventory costing method minimizes income taxes? Required 4 Required 5 Which inventory costing method minimizes income taxes? OFIFO OLIFO Units 300 < Required 4 900 800 300 680 Unit Cost $19 Required 5 > 17 20
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