Required information P7-4 (Algo) Analyzing and Interpreting Income Manipulation Under the LIFO Inventory Method LO7-2, 7-3 [The following information applies to the questions displayed below.] Pacific Company sells electronic test equipment that it acquires from a foreign source. During the year, the inventory records reflected the following: Beginning inventory Purchases Sales (49 units at $24,580 each) P7-4 Part 2 Inventory is valued at cost using the LIFO inventory method. PACIFIC COMPANY Income Statement For the Current Year Ended Units 24 39 Sales revenue Cost of goods sold Gross profit Expenses Pretax income Ending inventory Unit Cost $11,520 10,020 2. The management, for various reasons, is considering buying 24 additional units before December 31 year-end at $9,520 each. Restate the income statement (and ending inventory), assuming that this purchase is made on December 31. Assume the LIFO method and the periodic inventory system are used by the company. 294,000 Total Cost $ 276,480 390,780
Required information P7-4 (Algo) Analyzing and Interpreting Income Manipulation Under the LIFO Inventory Method LO7-2, 7-3 [The following information applies to the questions displayed below.] Pacific Company sells electronic test equipment that it acquires from a foreign source. During the year, the inventory records reflected the following: Beginning inventory Purchases Sales (49 units at $24,580 each) P7-4 Part 2 Inventory is valued at cost using the LIFO inventory method. PACIFIC COMPANY Income Statement For the Current Year Ended Units 24 39 Sales revenue Cost of goods sold Gross profit Expenses Pretax income Ending inventory Unit Cost $11,520 10,020 2. The management, for various reasons, is considering buying 24 additional units before December 31 year-end at $9,520 each. Restate the income statement (and ending inventory), assuming that this purchase is made on December 31. Assume the LIFO method and the periodic inventory system are used by the company. 294,000 Total Cost $ 276,480 390,780
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required information
P7-4 (Algo) Analyzing and Interpreting Income Manipulation Under the LIFO Inventory Method LO7-2, 7-3
[The following information applies to the questions displayed below.]
Pacific Company sells electronic test equipment that it acquires from a foreign source. During the year, the inventory
records reflected the following:
Beginning inventory
Purchases
Sales (49 units at $24,580 each)
P7-4 Part 2
Inventory is valued at cost using the LIFO inventory method.
PACIFIC COMPANY
Income Statement
For the Current Year Ended
Sales revenue
Cost of goods sold
Gross profit
Units
24
39
2. The management, for various reasons, is considering buying 24 additional units before December 31 year-end at $9,520 each.
Restate the income statement (and ending inventory), assuming that this purchase is made on December 31. Assume the LIFO method
and the periodic inventory system are used by the company.
Expenses
Pretax income
Ending inventory
Unit Cost
$11,520
10,020
294,000
Total Cost
$ 276,480
390,780](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3df18d00-8b20-421a-9a56-9feecea750e5%2F69b2cd4b-c7eb-4f84-aa21-30b8687f892a%2Frigjgmi_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
P7-4 (Algo) Analyzing and Interpreting Income Manipulation Under the LIFO Inventory Method LO7-2, 7-3
[The following information applies to the questions displayed below.]
Pacific Company sells electronic test equipment that it acquires from a foreign source. During the year, the inventory
records reflected the following:
Beginning inventory
Purchases
Sales (49 units at $24,580 each)
P7-4 Part 2
Inventory is valued at cost using the LIFO inventory method.
PACIFIC COMPANY
Income Statement
For the Current Year Ended
Sales revenue
Cost of goods sold
Gross profit
Units
24
39
2. The management, for various reasons, is considering buying 24 additional units before December 31 year-end at $9,520 each.
Restate the income statement (and ending inventory), assuming that this purchase is made on December 31. Assume the LIFO method
and the periodic inventory system are used by the company.
Expenses
Pretax income
Ending inventory
Unit Cost
$11,520
10,020
294,000
Total Cost
$ 276,480
390,780
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