Richardson’s Flower Depot uses FIFO for internal reporting purposes and LIFO for financial and income tax purposes. At the end of 2020, the following information was obtained from the inventory records: 2018 2019 2020 Ending inventory, FIFO $78,650 $82,785 $93,678 Ending inventory, LIFO 68,500 75,640 84,675 Beginning inventory, FIFO 67,535 78,650 82,785 Beginning inventory, LIFO 74,565 68,500 75,640 Required: 1. Prepare the necessary entry to convert to LIFO at the end of 2020. 2. How much would Richardson’s cost of goods sold differ in 2020 if it used FIFO for external reporting?

Q: On December 31, 2020, Jen & Mink Clothing (J&M) performed the inventory count and determined the…

A: Inventory valuation refers to the process of assigning a monetary value to the inventory of a…

Q: Richardson's Flower Depot uses FIFO for internal reporting purposes and LIFO for financial

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A: An increase in beginning inventory due to a change in the method of inventory decreases the profit.…

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A: The amount that remains after expenses, benefits, and taxes are subtracted from the earnings of a…

Q: 3. & 4. Determine the balance in retained earnings at January 1, 2020 as Fieri reported using FIFO…

A: Solution:- Given, Revenue = $390 mil Cost of goods sold FIFO = $39 mil ; Average = $54 mil…

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A: Ending inventory at cost = Inventory value * Cost to retail ratio

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A: The first in first out method is one of the important methods of valuing inventory in which the…

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A: The missing values are calculated using the accounting formulas. Sometimes single-entry books are…

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A: Retained earnings shows the income income of the company which the company has accumulated over a…

Q: Oriole Corporation had the following items in inventory as at December 31, 2020: Item No.…

A: Direct Method : In Direct method the business will charge the inventory write-off to COGS account.…

Q: Crane Corporation began operations on December 1, 2019. The only inventory transaction in 2019 was…

A: Solution: Cost of goods available for sale = (110*$21) + (310*$25 + 310*$26 + 210*$29 + 110*$32) =…

Q: Zac Company has following information related to its financial statements in 2020:  (1) Zac changed…

A: Answer 1)

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A: Deciding how much money to put into a company's inventory is known as inventory valuation. In order…

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Q: During 2019 (its first year of operations) and 2020, Fieri Foods used the FIFO inventory costing…

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Q: In 2021, CPS Company changed its method of valuing inventory from the FIFO method to the average…

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A: First In, First Out, generally known as FIFO, is a valuation technique in which assets created or…

Q: ^ A

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A: The question is based on the concept of Journal Entry.

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A: Businesses gain from adjustment entries by supporting auditing and assurance procedures, assuring…

Q: Splish Company began operations in 2020 and determined its ending inventory at cost and at LCNRV at…

A: (a)   DateAccount Titles and Explanations Debit   (in $ )  Credit (in $ )     12/31/2020Cost of…

Q: Taylor Company uses a periodic inventory system. The following is partial information from its…

A: Beginning inventory = Cost of goods sold + Ending inventory - (Purchases - Purchase returns) Gross…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.