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The following information pertains to the inventory of Parvin Company during Year 2: Jan. Beginning Inventory 1 Apr. 1 Oct. 1 Purchased Purchased 300 units @ $ 37 2,900 units @ $42 500 units @ $ 45 During Year 2, Parvin sold 3,500 units of inventory at $80 per unit and incurred $46,000 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 3 percent income tax rate. Parvin started the period with cash of $84,000, inventory of $11,100, common stock of $59,00 and retained earnings of $36,100. Exercise 5-6A Part b b. Prepare income statements using FIFO and LIFO.

The following information pertains to the inventory of Parvin Company during Year 2: Jan. Beginning Inventory 1 Apr. 1 Oct. 1 Purchased Purchased 300 units @ $ 37 2,900 units @ $42 500 units @ $ 45 During Year 2, Parvin sold 3,500 units of inventory at $80 per unit and incurred $46,000 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 3 percent income tax rate. Parvin started the period with cash of $84,000, inventory of $11,100, common stock of $59,00 and retained earnings of $36,100. Exercise 5-6A Part b b. Prepare income statements using FIFO and LIFO.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The following information pertains to the inventory of Parvin Company during Year 2: Jan. Beginning Inventory 1 Apr. 1 Oct. 1 Purchased Purchased 300 units @ $ 37 2,900 units @ $42 500 units @ $ 45 During Year 2, Parvin sold 3,500 units of inventory at $80 per unit and incurred $46,000 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. Parvin started the period with cash of $84,000, inventory of $11,100, common stock of $59,000, and retained earnings of $36,100. Exercise 5-6A Part b b. Prepare income statements using FIFO and LIFO.
Transcribed Image Text:The following information pertains to the inventory of Parvin Company during Year 2: Jan. Beginning Inventory 1 Apr. 1 Oct. 1 Purchased Purchased 300 units @ $ 37 2,900 units @ $42 500 units @ $ 45 During Year 2, Parvin sold 3,500 units of inventory at $80 per unit and incurred $46,000 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. Parvin started the period with cash of $84,000, inventory of $11,100, common stock of $59,000, and retained earnings of $36,100. Exercise 5-6A Part b b. Prepare income statements using FIFO and LIFO.
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