Rockwell Corporation uses a periodic inventory system and has used the FIFO cost method since inception of
Question:
Additional Information:
a. The company's effective income tax rate is 40% for all years.
b. If the company had used the average cost method prior to 2011, ending inventory for 2010 would have been $130,000.
c. 7,000 units remained in inventory at the end of 2011.
Required:
1. Ignoring income taxes, prepare the 2011 journal entry to adjust the accounts to reflect the average cost method.
2. What is the effect of the change in methods on 2011 net income?
Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For
Intermediate Accounting
ISBN: 978-0077400163
6th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
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