The following information comes from the 2024 Ocean Petroleum Corporation annual report to shareholders: NOTE 4 INVENTORIES Net carrying values of inventories valued under the LIFO method were approximately $178 million and $198 million on December 31, 2024 and 2023, respectively. Inventories consisted of the following: ($ in millions) Raw materials Materials and supplies Finished goods LIFO reserve Total 2024 2023 $ 72 $ 71 453 452 782 401 1,307 924 (49) (43) $ 1,258 $ 881 The LIFO reserve indicates that inventories would have been $49 million and $43 million higher at the end of 2024 and 2023, respectively, if Ocean Petroleum had used FIFO to value its entire inventory. Required: If Ocean Petroleum had used FIFO to value its entire inventory how would its 2024 pre-tax income be affected? Pre-tax income would have been million if FIFO had been used to value the entire inventory
The following information comes from the 2024 Ocean Petroleum Corporation annual report to shareholders: NOTE 4 INVENTORIES Net carrying values of inventories valued under the LIFO method were approximately $178 million and $198 million on December 31, 2024 and 2023, respectively. Inventories consisted of the following: ($ in millions) Raw materials Materials and supplies Finished goods LIFO reserve Total 2024 2023 $ 72 $ 71 453 452 782 401 1,307 924 (49) (43) $ 1,258 $ 881 The LIFO reserve indicates that inventories would have been $49 million and $43 million higher at the end of 2024 and 2023, respectively, if Ocean Petroleum had used FIFO to value its entire inventory. Required: If Ocean Petroleum had used FIFO to value its entire inventory how would its 2024 pre-tax income be affected? Pre-tax income would have been million if FIFO had been used to value the entire inventory
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The following information comes from the 2024 Ocean Petroleum Corporation annual report to shareholders:
NOTE 4 INVENTORIES
Net carrying values of inventories valued under the LIFO method were approximately $178 million and $198 million on
December 31, 2024 and 2023, respectively. Inventories consisted of the following: ($ in millions)
Raw materials
Materials and supplies
Finished goods
LIFO reserve
Total
2024
2023
$ 72
$ 71
453
452
782
401
1,307
924
(49)
(43)
$ 1,258
$ 881
The LIFO reserve indicates that inventories would have been $49 million and $43 million higher at the end of 2024 and 2023,
respectively, if Ocean Petroleum had used FIFO to value its entire inventory.
Required:
If Ocean Petroleum had used FIFO to value its entire inventory how would its 2024 pre-tax income be affected?
Pre-tax income would have been
million
if FIFO had been used to value the entire inventory
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