Scoresby Inc. 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 Units Unit Costa. Inventory, Beginning 4,000 $ 30 cost per unitFor the year: b. Purchase, March 5 10,000 $31 cost per unit c. Purchase, September 19 6,000 units $33 cost per unitd. Sale, April 15 (sold for $75 per unit) 4,400 e. Sale, October 31 (sold for $78 per unit) 9,000 f. Operating expenses (excluding income tax expense), $607,000 ________________________________________Required:3. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost.4. 4. Prepare an income statement that shows the FIFO method, LIFO method and weighted average method. **Exercise on Inventory Costing Methods**This exercise is part of Chapter 7's Graded Exercises and Problems. It focuses on computing the cost of ending inventory and cost of goods sold using different costing methods: FIFO, LIFO, and weighted average cost. Additionally, it involves preparation of an income statement and understanding which inventory costing method minimizes income taxes.**Tasks:**1. **Compute the Cost of Ending Inventory and Cost of Goods Sold**: - Use the methods of FIFO (First-In, First-Out), LIFO (Last-In, First-Out), and Weighted Average Cost.**Table: Inventory Costing Calculation**The given table requires completion for each costing method:- **FIFO**: - Enter values for Cost of Ending Inventory and Cost of Goods Sold. - **LIFO**: - Enter values for Cost of Ending Inventory and Cost of Goods Sold.- **Weighted Average Cost**: - Enter values for Cost of Ending Inventory and Cost of Goods Sold.*Buttons for Additional Requirements*:- Click on "Required 2" and "Required 4" for further details and tasks.**Additional Resources**:- eBook- Hints- Print option- References*Navigation*:- Use the arrows for previous or next pages within this chapter's exercises.**Note**: The user is encouraged to complete this question by entering their answers in the provided table.This exercise helps in understanding how different inventory costing methods impact financial statements and tax outcomes. **Chapter 7 Graded Exercises and Problems****Question 2****Task:**Complete this question by entering your answers in the tabs below.Prepare an income statement that shows the FIFO method, LIFO method, and weighted average method.**SCORESBY INC.****Income Statement**For the Year Ended December 31| | FIFO | LIFO | Weighted Average ||-------------------|------|------|------------------|| Sales Revenue | | | || Gross Loss | | | || Income (Loss) from Operations | | | |**Navigation:**[Required 3] [Required 6]**Instructions:**- Enter your answers under the appropriate method (FIFO, LIFO, Weighted Average).- You’ll need to fill out the sales revenue, gross loss, and income (loss) from operations for each method.**Additional Resources:**- eBook- Hint- Print- References**Interface:**- Check my work button available.- Options to Help, Save & Exit, and Submit.**Note:** Look for any additional information or data needed to complete the statement in the referenced materials or previous sections.

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Description: Scoresby Inc. 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 informat

INTRODUCTION Periodic inventory system is the method of recording inventory. Under Periodic system…

Answered: Scoresby Inc. tracks the number of…

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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Scoresby Inc. 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 Units Unit Cost
a. Inventory, Beginning 4,000 $ 30 cost per unit
For the year:
b. Purchase, March 5 10,000 $31 cost per unit
c. Purchase, September 19 6,000 units $33 cost per unit
d. Sale, April 15 (sold for $75 per unit) 4,400
e. Sale, October 31 (sold for $78 per unit) 9,000
f. Operating expenses (excluding income tax expense), $607,000
________________________________________

Required:

3. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost.
4. 4. Prepare an income statement that shows the FIFO method, LIFO method and weighted average method.

**Exercise on Inventory Costing Methods**

This exercise is part of Chapter 7's Graded Exercises and Problems. It focuses on computing the cost of ending inventory and cost of goods sold using different costing methods: FIFO, LIFO, and weighted average cost. Additionally, it involves preparation of an income statement and understanding which inventory costing method minimizes income taxes.

**Tasks:**

1. **Compute the Cost of Ending Inventory and Cost of Goods Sold**:
- Use the methods of FIFO (First-In, First-Out), LIFO (Last-In, First-Out), and Weighted Average Cost.

**Table: Inventory Costing Calculation**

The given table requires completion for each costing method:

- **FIFO**:
- Enter values for Cost of Ending Inventory and Cost of Goods Sold.

- **LIFO**:
- Enter values for Cost of Ending Inventory and Cost of Goods Sold.

- **Weighted Average Cost**:
- Enter values for Cost of Ending Inventory and Cost of Goods Sold.

*Buttons for Additional Requirements*:
- Click on "Required 2" and "Required 4" for further details and tasks.

**Additional Resources**:
- eBook
- Hints
- Print option
- References

*Navigation*:
- Use the arrows for previous or next pages within this chapter's exercises.

**Note**: The user is encouraged to complete this question by entering their answers in the provided table.

This exercise helps in understanding how different inventory costing methods impact financial statements and tax outcomes.

**Chapter 7 Graded Exercises and Problems**

**Question 2**

**Task:**
Complete this question by entering your answers in the tabs below.

Prepare an income statement that shows the FIFO method, LIFO method, and weighted average method.

**SCORESBY INC.**

**Income Statement**
For the Year Ended December 31

| | FIFO | LIFO | Weighted Average |
|-------------------|------|------|------------------|
| Sales Revenue | | | |
| Gross Loss | | | |
| Income (Loss) from Operations | | | |

**Navigation:**
[Required 3] [Required 6]

**Instructions:**
- Enter your answers under the appropriate method (FIFO, LIFO, Weighted Average).
- You’ll need to fill out the sales revenue, gross loss, and income (loss) from operations for each method.

**Additional Resources:**
- eBook
- Hint
- Print
- References

**Interface:**
- Check my work button available.
- Options to Help, Save & Exit, and Submit.

**Note:** Look for any additional information or data needed to complete the statement in the referenced materials or previous sections.

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