Please help me answer this question K. Co. uses LIFO inventory method. At the end of the 2006accounting period, the company reported $10,000 of netearnings on I/S. The inventory balance on the 2006 B/S is$7,000. In the footnotes, LIFO reserve at the end of 2006 is$3,000 and LIFO reserve at the end of 2005 is $2,500. JJ Co.uses FIFO and reported 10,300 of net earnings on the 2006I/S. Which company has a higher earnings if both of thecompanies would use the same inventory method?

Step 1: Define Inventory methodThe inventory method is to evaluate the inventory (raw material or…

Answered: K. Co. uses LIFO inventory method. At…

SWFT Individual Income Taxes

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Author:YOUNG

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Chapter18: Accounting Periods And Methods

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Problem 67P

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Kante Company uses periodic FIFO for its internal report and periodic LIFO for its external reports. In its FIFO-based internal reports, Kante had a beginning inventory of $96,000, an ending inventory of $116,000, and a pretax income of $750,000. Under LIFO, Kante's beginning inventory would have been $78,000, and its ending inventory would have been $109,000. How much pretax income would Kante report in its external reports?
Assume that Merryland’s Markets had an inventory balance of $32 570 at the close of the last accounting period. The following sales and purchase transactions are for the current period. NOTE: GST at 10% is included in the amount where applicable. 1. 2. 3. 4. Purchased goods on account for $29,909. Returned part of the above purchase that had an original invoice price of $1,749. Paid for the balance of the purchase in time to receive a discount of 2% of the invoice price. Sold goods on account costing $24 900 for an invoice price of $54 802. Required (a) Prepare general journal entries assuming the perpetual inventory system is used. (b) Suppose that a physical count of the inventory at the end of the current period shows inventory of $30,420 to be on hand. Present the entries (if any) required to adjust for any discrepancy.
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In March 2015, XYZ Corp. purchased an item of inventory for $30. By June, that item could be purchased for $26 and re-sold for $31. XYZ's normal profit for the item is $4. At what amount should XYZ report the item in its June 30 balance sheet? XYZ uses the LIFO inventory cost flow assumption. (omit , and $ in the answer) 30
Hot Pepper Company had the following information in its accounting records at year end:Inventory Cost $4,000,000It estimates the net realizable value of this inventory is $3,500,000. As a result of this information Hot Pepper Co. would: Make a journal entry debiting a loss on inventory decline for $500,000 Make a journal entry debiting the allowance for inventory valuation for $500,000 Make a journal entry crediting the allowance for inventory valuation for $500,000 Make a journal entry debiting a gain on market appreciation for $500,000 Make no entry
Esquire Incorporated uses the LIFO method to report its inventory. Inventory at the beginning of the year was $768,000 (32,000 units at $24 each). During the year, 104,000 units were purchased, all at the same price of $27 per unit. 112,000 units were sold during the year. Calculate ending inventory and cost of goods sold at the end of the year based on a periodic inventory system. Beginning Inventory Purchases Total Cost of Goods Available for Sale Cost per unit 32,000 $24 $ 104,000 27 136,000 Number of units Cost of Goods Available for Sale $ 768,000 2,808,000 3,576,000 Cost of Goods Sold - Periodic LIFO Cost per unit $ 24 $ $27 Number of units sold 0 Cost of Goods Sold $ 0 0 0 Ending Inventory - Periodic LIFO Cost Number of units in per ending inventory unit $ 24 $ $27 0 Ending Inventory $ 0 0 0
Brooke Company used a perpetual inventory system. At the end of 2012, the inventory account was P360,000 and P30,000 of those goods. included in ending inventory were purchased FOB shipping point and did not arrive until 2013. Purchases in 2013 were P3,000,000. The perpetual inventory records showed an ending inventory of P420,000 for 2013. A physical count at the end of 2013 showed an inventory of P380,000. Inventory shortages are included in cost of goods sold. What amount should be reported as cost of goods sold for 2013?
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Romanoff Industries had the following inventory transactions occur during 2013: Units Cost/unit 2/1/13 Purchase 18 $45 3/14/13 Purchase 31 $47 5/1/13 Purchase 22 $49 The company sold 50 units at $70 each and has a tax rate of 30%. Assuming that a periodic inventory system is used, what is the company's gross profit using FIFO? a. $1,106 b. $1,184 c. $2,316 d. $2,394
Coulter Company uses the LIFO inventory method under theperiodic inventory system. The following data were available for the month ofJanuary, 2009: Units Cost per Unit Inventory,January 1 200 $5.00 PurchaseNo. 1 400 $5.50 SaleNo. 1 (sold at $12.00 per unit) 500 PurchaseNo. 2 700 $6.00 SaleNo. 2 (sold at $13.00 per unit) 500 Compute the following:Beginning inventoryEnding inventoryGoods available for saleCost of goods soldGross margin

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