Quality Manufacturers uses the LIFO cost flow assumption to value inventory. For the year 2009, it reported the following information in its financial statements: Revenue = $5.1 million Cost of goods sold = $1.3 million Other expenses = $2.5 million Interest expenses = $0.6 million Tax expenses = $0.42 million Beginning inventory = $8.3 million Ending inventory = $7.4 million Beginning LIFO reserve = $0.72 million Ending LIFO reserve = $0.83 million Tax rate = 35% Quality Manufacturers' net income, if it used the FIFO cost flow assumption, will be closest to: $318,500 $351,500 $0.3185
Quality Manufacturers uses the LIFO cost flow assumption to value inventory. For the year 2009, it reported the following information in its financial statements: Revenue = $5.1 million Cost of goods sold = $1.3 million Other expenses = $2.5 million Interest expenses = $0.6 million Tax expenses = $0.42 million Beginning inventory = $8.3 million Ending inventory = $7.4 million Beginning LIFO reserve = $0.72 million Ending LIFO reserve = $0.83 million Tax rate = 35% Quality Manufacturers' net income, if it used the FIFO cost flow assumption, will be closest to: $318,500 $351,500 $0.3185
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Quality Manufacturers uses the LIFO cost flow assumption to value inventory. For the year 2009, it reported the following information in its financial statements:
- Revenue = $5.1 million
- Cost of goods sold = $1.3 million
- Other expenses = $2.5 million
- Interest expenses = $0.6 million
- Tax expenses = $0.42 million
- Beginning inventory = $8.3 million
- Ending inventory = $7.4 million
- Beginning LIFO reserve = $0.72 million
- Ending LIFO reserve = $0.83 million
- Tax rate = 35%
Quality Manufacturers' net income, if it used the FIFO cost flow assumption, will be closest to:
$318,500
$351,500
$0.3185
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