Carolina's ending inventory using the perpetual LIFO method was $8,700. Carolina's accountant determined that had the...
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Carolina's ending inventory using the perpetual LIFO method was $8,700. Carolina's accountant determined that had the company used perpetual FIFO, the ending inventory wou. have been $9,100. a. Determine what the income before taxes would have been, had Carolina used the FIFO method of inventory valuation instead of LIFO. b. What would be the difference in income taxes between LIFO and FIFO, assuming a 30% tax rate? c. If Carolina wanted to lower the amount of income taxes to be paid, which method would it choose? Carolina's ending inventory using the perpetual LIFO method was $8,700. Carolina's accountant determined that had the company used perpetual FIFO, the ending inventory wou. have been $9,100. a. Determine what the income before taxes would have been, had Carolina used the FIFO method of inventory valuation instead of LIFO. b. What would be the difference in income taxes between LIFO and FIFO, assuming a 30% tax rate? c. If Carolina wanted to lower the amount of income taxes to be paid, which method would it choose?
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a The income before taxes would have been 1400 higher had Carol... View the full answer
Related Book For
Intermediate accounting
ISBN: 978-0077647094
7th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
Posted Date:
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