FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method. To identify: FIFO and LIFO method.

Question

Want to see the full answer?

Answer 1

Question

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

I need a expert not AI Step Amount Category Inventory 1. Beginning Balance, January 1 28,000 Beginning Balance Raw Materials 2. (+) Purchases (RM Purchases) 220,000 Addition Raw Materials 3. (-) Ending Balance 20,000 Ending Balance Raw Materials 4. = Transferred Out (RM used) (228,000) Transferred Out Raw Materials 5. (+) Direct Labor (152,000) Transferred Out Direct Labor 6. (+) Fixed Overhead 300,000 Addition Overhead 7. (+) Variable Overhead - Addition Overhead 8. = Total Factory Overhead (390,000) Transferred Out Overhead 9. Beginning Balance, January 1 40,000 Beginning Balance WIP 10. (+) Additions (RM used) 228,000 Addition WIP 11. (+) Additions (DL used) 152,000 Addition WIP 12. (+) Additions (OH used) 390,000 Addition WIP 13. (-) Ending Balance, December 31 55,000 Ending Balance WIP 14. = Transferred Out (COGM) (755,000)…

Step Amount Category Inventory 1. Beginning Balance, January 1 28,000 Beginning Balance Raw Materials 2. (+) Purchases (RM Purchases) 220,000 Addition Raw Materials 3. (-) Ending Balance 20,000 Ending Balance Raw Materials 4. = Transferred Out (RM used) (228,000) Transferred Out Raw Materials 5. (+) Direct Labor (152,000) Transferred Out Direct Labor 6. (+) Fixed Overhead 300,000 Addition Overhead 7. (+) Variable Overhead - Addition Overhead 8. = Total Factory Overhead (390,000) Transferred Out Overhead 9. Beginning Balance, January 1 40,000 Beginning Balance WIP 10. (+) Additions (RM used) 228,000 Addition WIP 11. (+) Additions (DL used) 152,000 Addition WIP 12. (+) Additions (OH used) 390,000 Addition WIP 13. (-) Ending Balance, December 31 55,000 Ending Balance WIP 14. = Transferred Out (COGM) (755,000) Transferred Out WIP 15.…

Introduce yourself to your peers by sharing something unique about your background. Explain how you expect this course will help you move forward in your current or future career.

Answer 2

Question

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Answer 6

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

Answer 7

Chapter 5, Problem 22QS

(a)

To determine

Introduction: FIFO method works on the principle that goods that are bought first (old products) will be sold first and LIFO follows that good that came at last will be sold first. LIFO is used by fewer companies as goods that are older are sold first which is done in FIFO method.

To identify: FIFO and LIFO method.

Answer 8

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Answer 9

(b)

To determine

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.

Answer 10

Expert Solution & Answer

Answer 11

Expert Solution & Answer

Answer 12

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 13

Ch. 5 - Prob. 1QS Ch. 5 - Prob. 2QS Ch. 5 - Prob. 3QS Ch. 5 - Prob. 4QS Ch. 5 - Perpetual: Inventory costing with FIFO P1 A...Ch. 5 - Prob. 6QS Ch. 5 - Prob. 7QS Ch. 5 - Prob. 8QS Ch. 5 - Prob. 9QS Ch. 5 - A Periodic: Inventory costing with weighted...

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability. To identify: FIFO and LIFO method.

Want to see the full answer?

Chapter 5 Solutions

Introduction: The price of the inventory affects the net income which lead to tax effects. If an inventory is overvalued it will increase the profit which thereby increases the tax liability.

To identify: FIFO and LIFO method.