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Volata Company began operations on January 1, 2023. In the second quarter of 2024, it adopted the FIFO method of inventory valuation. In the past, it used the LIFO method. The company's interim income statements as originally reported under the LIFO method follow: Accounts Sales Cost of goods sold (LIFO) Operating expenses Income before income taxes Income taxes (25%) Net income Accounts Cost of goods sold (FIFO) 2823 2824 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter $ 33,000 $ 35,000 $ 37,000 $ 39,000 $ 41,000 8,100 4,900 $ 24,000 6,000 10,800 5,500 $ 24,700 6,175 $ 18,000 $ 18,525 6,300 4,300 Net income Earnings per share $ 22,400 5,600 $ 16,800 If the FIFO method had been used since the company began operations, cost of goods sold in each of the previous quarters would have been as follows: 2023 7,300 4,500 $ 23,200 5,800 $ 17,400 Sales for the second quarter of 2024 are $43.000, cost of goods sold under the FIFO method is $11,300, and operating expenses are $5,700. The effective tax rate remains 25 percent. Volata Company has 1,000 shares of common stock outstanding. 2823 2824 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter $ 6,100 $ 6,900 $ 7,500 $ 8,300 $ 9,700 Required: Prepare a schedule showing the calculation of net income and earnings per share that Volata reports for the three-month period and the six-month period ended June 30, 2023 and 2024. Note: Round "Earnings per share" answers to 2 decimal places. Three Months Ended June 30 Answer is not complete. 2024 $ 26,000 9,300 5,300 Six Months Ended June 30 $ 24,400 6,100 $ 18,300 2023 2024 $ 43,400 S 1,000.00

Volata Company began operations on January 1, 2023. In the second quarter of 2024, it adopted the FIFO method of inventory valuation. In the past, it used the LIFO method. The company's interim income statements as originally reported under the LIFO method follow: Accounts Sales Cost of goods sold (LIFO) Operating expenses Income before income taxes Income taxes (25%) Net income Accounts Cost of goods sold (FIFO) 2823 2824 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter $ 33,000 $ 35,000 $ 37,000 $ 39,000 $ 41,000 8,100 4,900 $ 24,000 6,000 10,800 5,500 $ 24,700 6,175 $ 18,000 $ 18,525 6,300 4,300 Net income Earnings per share $ 22,400 5,600 $ 16,800 If the FIFO method had been used since the company began operations, cost of goods sold in each of the previous quarters would have been as follows: 2023 7,300 4,500 $ 23,200 5,800 $ 17,400 Sales for the second quarter of 2024 are $43.000, cost of goods sold under the FIFO method is $11,300, and operating expenses are $5,700. The effective tax rate remains 25 percent. Volata Company has 1,000 shares of common stock outstanding. 2823 2824 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter $ 6,100 $ 6,900 $ 7,500 $ 8,300 $ 9,700 Required: Prepare a schedule showing the calculation of net income and earnings per share that Volata reports for the three-month period and the six-month period ended June 30, 2023 and 2024. Note: Round "Earnings per share" answers to 2 decimal places. Three Months Ended June 30 Answer is not complete. 2024 $ 26,000 9,300 5,300 Six Months Ended June 30 $ 24,400 6,100 $ 18,300 2023 2024 $ 43,400 S 1,000.00

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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Volata Company began operations on January 1, 2023. In the second quarter of 2024, it adopted the FIFO method of inventory valuation. In the past, it used the LIFO method. The company's interim income statements as originally reported under the LIFO method follow: Accounts Sales Cost of goods sold (LIFO) Operating expenses Income before income taxes Income taxes (25%) Net income Accounts Cost of goods sold (FIFO) Net income 2023 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter $ 33,000 $ 35,000 $ 39,000 7,300 4,500 $ 23,200 5,800 $ 37,000 8,100 4,900 $ 24,000 6,000 $ 17,400 $ 18,000 If the FIFO method had been used since the company began operations, cost of goods sold in each of the previous quarters would have been as follows: 6,300 4,300 $ 22,400 5,600 $ 16,800 Earnings per share Sales for the second quarter of 2024 are $43.000, cost of goods sold under the FIFO method is $11,300, and operating expenses are $5.700. The effective tax rate remains 25 percent. Volata Company has 1,000 shares of common stock outstanding. 2023 Required: Prepare a schedule showing the calculation of net income and earnings per share that Volata reports for the three-month period and the six-month period ended June 30, 2023 and 2024. Note: Round "Earnings per share" answers to 2 decimal places. 2823 2824 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter $ 6,100 $ 6,900 $ 7,500 $ 8,300 $ 9,700 Answer is not complete. Three Months Ended June 30 9,300 5,300 $ 24,400 6,100 $ 18,300 2824 1st Quarter $ 41,000 10,800 5,500 $ 24,700 6,175 $ 18,525 2024 $ 26,000 X Six Months Ended June 30 2023 2024 S 43,400 X S 1,000.00
Transcribed Image Text:Volata Company began operations on January 1, 2023. In the second quarter of 2024, it adopted the FIFO method of inventory valuation. In the past, it used the LIFO method. The company's interim income statements as originally reported under the LIFO method follow: Accounts Sales Cost of goods sold (LIFO) Operating expenses Income before income taxes Income taxes (25%) Net income Accounts Cost of goods sold (FIFO) Net income 2023 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter $ 33,000 $ 35,000 $ 39,000 7,300 4,500 $ 23,200 5,800 $ 37,000 8,100 4,900 $ 24,000 6,000 $ 17,400 $ 18,000 If the FIFO method had been used since the company began operations, cost of goods sold in each of the previous quarters would have been as follows: 6,300 4,300 $ 22,400 5,600 $ 16,800 Earnings per share Sales for the second quarter of 2024 are $43.000, cost of goods sold under the FIFO method is $11,300, and operating expenses are $5.700. The effective tax rate remains 25 percent. Volata Company has 1,000 shares of common stock outstanding. 2023 Required: Prepare a schedule showing the calculation of net income and earnings per share that Volata reports for the three-month period and the six-month period ended June 30, 2023 and 2024. Note: Round "Earnings per share" answers to 2 decimal places. 2823 2824 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter $ 6,100 $ 6,900 $ 7,500 $ 8,300 $ 9,700 Answer is not complete. Three Months Ended June 30 9,300 5,300 $ 24,400 6,100 $ 18,300 2824 1st Quarter $ 41,000 10,800 5,500 $ 24,700 6,175 $ 18,525 2024 $ 26,000 X Six Months Ended June 30 2023 2024 S 43,400 X S 1,000.00
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