Required information [The following information applies to the questions displayed below.] An annual report for National Paper Company included the following note: The last-in, first-out inventory method is used to value most of National Paper's U.S. inventories... If the first-in, first-out method had been used, it would have increased total inventory balances by approximately $283.0 million and $240.0 million at December 31, 2017, and 2016, respectively. For the year 2017, National Paper Company reported net income (after taxes) of $2,144.0 million. At December 31, 2017, the balance of National Paper Company's retained earnings account was $6,280 million.
Required information [The following information applies to the questions displayed below.] An annual report for National Paper Company included the following note: The last-in, first-out inventory method is used to value most of National Paper's U.S. inventories... If the first-in, first-out method had been used, it would have increased total inventory balances by approximately $283.0 million and $240.0 million at December 31, 2017, and 2016, respectively. For the year 2017, National Paper Company reported net income (after taxes) of $2,144.0 million. At December 31, 2017, the balance of National Paper Company's retained earnings account was $6,280 million.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Hello, can someone explain to me how to do this?
![### Required Information
#### [The following information applies to the questions displayed below.]
An annual report for National Paper Company included the following note:
The last-in, first-out (LIFO) inventory method is used to value most of National Paper’s U.S. inventories. If the first-in, first-out (FIFO) method had been used, it would have increased total inventory balances by approximately $283.0 million and $240.0 million at December 31, 2017, and 2016, respectively.
For the year 2017, National Paper Company reported net income (after taxes) of $2,144.0 million. At December 31, 2017, the balance of National Paper Company’s retained earnings account was $6,280 million.
---
### Question
2. **Determine the amount of retained earnings that National Paper would have reported at the end of 2017 if it always had used the FIFO method (assume a 40 percent tax rate).**
*(Enter your answer in millions. Do not round your intermediate calculations. Round your final answer to the nearest whole number.)*
- **Retained Earnings**: [Input Box] million](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe5b66953-d8c0-491f-82b9-53ac9723ea16%2F22d4cbf7-dda7-46b3-875f-326b7c20f5de%2Fa27l36_processed.png&w=3840&q=75)
Transcribed Image Text:### Required Information
#### [The following information applies to the questions displayed below.]
An annual report for National Paper Company included the following note:
The last-in, first-out (LIFO) inventory method is used to value most of National Paper’s U.S. inventories. If the first-in, first-out (FIFO) method had been used, it would have increased total inventory balances by approximately $283.0 million and $240.0 million at December 31, 2017, and 2016, respectively.
For the year 2017, National Paper Company reported net income (after taxes) of $2,144.0 million. At December 31, 2017, the balance of National Paper Company’s retained earnings account was $6,280 million.
---
### Question
2. **Determine the amount of retained earnings that National Paper would have reported at the end of 2017 if it always had used the FIFO method (assume a 40 percent tax rate).**
*(Enter your answer in millions. Do not round your intermediate calculations. Round your final answer to the nearest whole number.)*
- **Retained Earnings**: [Input Box] million
![**Required Information**
*The following information applies to the questions displayed below.*
An annual report for National Paper Company included the following note:
The last-in, first-out (LIFO) inventory method is used to value most of National Paper’s U.S. inventories. If the first-in, first-out (FIFO) method had been used, it would have increased total inventory balances by approximately $283.0 million and $240.0 million at December 31, 2017, and 2016, respectively.
For the year 2017, National Paper Company reported net income (after taxes) of $2,144.0 million. At December 31, 2017, the balance of National Paper Company’s retained earnings account was $6,280 million.
**Required:**
1. Determine the amount of net income that National Paper would have reported in 2017 if it had used the FIFO method (assume a 40 percent tax rate).
*(Enter your answer in millions. Round your intermediate and final answer to 1 decimal place.)*
Net income: [Text box] million](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe5b66953-d8c0-491f-82b9-53ac9723ea16%2F22d4cbf7-dda7-46b3-875f-326b7c20f5de%2Flmr8p9e_processed.png&w=3840&q=75)
Transcribed Image Text:**Required Information**
*The following information applies to the questions displayed below.*
An annual report for National Paper Company included the following note:
The last-in, first-out (LIFO) inventory method is used to value most of National Paper’s U.S. inventories. If the first-in, first-out (FIFO) method had been used, it would have increased total inventory balances by approximately $283.0 million and $240.0 million at December 31, 2017, and 2016, respectively.
For the year 2017, National Paper Company reported net income (after taxes) of $2,144.0 million. At December 31, 2017, the balance of National Paper Company’s retained earnings account was $6,280 million.
**Required:**
1. Determine the amount of net income that National Paper would have reported in 2017 if it had used the FIFO method (assume a 40 percent tax rate).
*(Enter your answer in millions. Round your intermediate and final answer to 1 decimal place.)*
Net income: [Text box] million
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