The following is the Balance Sheet and Income Statement for Ella Corp: LIFO BALANCE SHEET AT 12/31/2024:
Question:
The following is the Balance Sheet and Income Statement for Ella Corp:
LIFO BALANCE SHEET AT 12/31/2024:
Assets | Liabilities & Owners Equity | ||
Cash and Cash Equivalents | $1,000 | Accounts Payable | $3,000 |
Accounts Receivable, Net | $1,000 | Notes Payable | $4,000 |
Inventory | $8,000 | Common Stock | $13,000 |
PPE, Net | $20,000 | Retained Earnings | $10,000 |
TOTAL ASSETS | $30,000 | TOTAL LIAB. & OWNERS EQUITY | $30,000 |
LIFO INCOME STATEMENT FOR THE YEAR ENDING 12/31/2024:
Sales Revenue | $60,000 |
CGS | ($40,000) |
Gross Margin | $20,000 |
Other Gains/(Losses) | ($11,000) |
Pre-Tax Income | $9,000 |
Tax Expense (35%) | ($3,150) |
Net Income | $5,850 |
From its inception, Ella Corp. used LIFO to value its inventory. The LIFO reserve at 1/1/2024 is $500 and the LIFO reserve at 12/31/2024 is $1,200. You may assume that taxes are always 35% and all taxes are paid in cash.
1. If, from its inception, Ella Corp. has used FIFO to value its inventory instead of LIFO, what would Ella Corp. reports as 12/31/2024 Total Assets?
2.If, from its inception, Ella Corp. has used FIFO to value its inventory instead of LIFO, what would Ella Corp. reports as 12/31/2024 Accounts Payable?
3.If, from its inception, Ella Corp. has used FIFO to value its inventory instead of LIFO, what would Ella Corp. reports as 12/31/2024 Notes Payable?
4.If, from its inception, Ella Corp. has used FIFO to value its inventory instead of LIFO, what would Ella Corp. reports as 12/31/2024 Common Stock?
5.If, from its inception, Ella Corp. has used FIFO to value its inventory instead of LIFO, what would Ella Corp. reports as 12/31/2024 Retained Earnings?
6.If, from its inception, Ella Corp. has used FIFO to value its inventory instead of LIFO, what would Ella Corp. reports as 12/31/2024 Total Liab. + OE?
Financial Accounting
ISBN: 978-0134564142
6th Canadian edition
Authors: Walter Jr. Harrison, Charles T. Horngren, C. William Thomas, Greg Berberich, Catherine Seguin