Question: Inland Standard Equipment which sells industrial handling equipment values its

Inland Standard Equipment, which sells industrial handling equipment, values its inventory using LIFO. During the recent year, Inland Standard Equipment has experienced a significant increase in the cost of its inventory items. Although the net income for the current year has been fairly good, Roberta Hill, the company president, wishes it was higher because the company has been considering borrowing money to purchase a new building. Mrs. Hill has heard that a company’s choice of inventory valuation method can impact the net income of the company.
Mrs. Hill has asked the controller, Vicki Simpson, to explore the possibility of changing the company’s inventory valuation method.

1. If you were in Vicki’s position how you would respond to Mrs. Hill? Address potential ethical implications and applicable accounting principles in your answer.

View Solution:

Sale on SolutionInn
  • CreatedApril 29, 2014
  • Files Included
Post your question