Problem 5-33_Clear Photography, Inc_Inventory Valuation

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Description

Problem 5-33 Effect of
different inventory cost flow methods on financial statements
The
accounting records of Clear Photography, Inc., reflected the following balances
as of
January
1, 2012:
Cash
$18,000
Beginning
inventory 13,500 (150 units @ $90)
Common
stock 15,000
Retained
earnings 16,500

The
following five transactions occurred in 2012:
1.
First purchase (cash) 120 units @ $92
2.
Second purchase (cash) 200 units @ $100
3.
Sales (all cash) 300 units @ $185
4.
Paid $15,000 cash for operating expenses.
5.
Paid cash for income tax at the rate of 40 percent of income before taxes.

Required

a.
Compute the cost of goods sold and ending inventory, assuming (1) FIFO cost
flow, (2) LIFO
cost
flow, and (3) weighted-average cost flow.

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