Chemical Boost, Inc. is a manufacturer of chemical and derivative products. Presented below is selected information...

  

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Chemical Boost, Inc. is a manufacturer of chemical and derivative products. Presented below is selected information from Chemical Boost's recent annual report. Chemical Boost, Inc. Condensed Balance Sheet ($ millions) Assets Inventory Other current assets Noncurrent assets Total Year 2 Year 1 Cost of goods sold Gross proft Other expenses Income taxes Net earnings $16,250 $15,500 33,900 34,750 50,750 47,250 $ 100,900 $97,500 Chemical Boost, Inc. Condensed Statement of Earnings Year 2 Year 1 ($ millions) Revenues $ 101,425 $ 104,750 69,125 70,600 32,300 34,150 29,400 31,063 750 1,550 $ 2,150 $1,538 Liabilities & Shareholders' Equity Liabilities Capital stock Retained earnings Total Year 2 Year 1 $63,175 $61,300 18,650 17,950 19,075 18,250 $100,900 $97,500 The footnotes to the company's financial statements revealed that Chemical Boost, Inc. values most of its inventory using LIFO. The LIFO reserve was approximately $1,500 million and $750 million, respectively, at the end of Year 2 and Year 1. Assume an effective tax rate of 26%. 1. If Chemical Boost, Inc. had used FIFO instead of LIFO to value its inventory, what value would have been reported for Year 2 for the following accounts? Enter answers in millions. Round to the nearest million, if needed. a. Ending inventory $ million b. Cost of goods sold $ c. Net income before $ d. Retained earnings $ million $ million million 2. How much additional income tax would the company have paid if it had used FIFO instead of LIFO to value its inventory? Round to the nearest millions. million Chemical Boost, Inc. is a manufacturer of chemical and derivative products. Presented below is selected information from Chemical Boost's recent annual report. Chemical Boost, Inc. Condensed Balance Sheet ($ millions) Assets Inventory Other current assets Noncurrent assets Total Year 2 Year 1 Cost of goods sold Gross proft Other expenses Income taxes Net earnings $16,250 $15,500 33,900 34,750 50,750 47,250 $ 100,900 $97,500 Chemical Boost, Inc. Condensed Statement of Earnings Year 2 Year 1 ($ millions) Revenues $ 101,425 $ 104,750 69,125 70,600 32,300 34,150 29,400 31,063 750 1,550 $ 2,150 $1,538 Liabilities & Shareholders' Equity Liabilities Capital stock Retained earnings Total Year 2 Year 1 $63,175 $61,300 18,650 17,950 19,075 18,250 $100,900 $97,500 The footnotes to the company's financial statements revealed that Chemical Boost, Inc. values most of its inventory using LIFO. The LIFO reserve was approximately $1,500 million and $750 million, respectively, at the end of Year 2 and Year 1. Assume an effective tax rate of 26%. 1. If Chemical Boost, Inc. had used FIFO instead of LIFO to value its inventory, what value would have been reported for Year 2 for the following accounts? Enter answers in millions. Round to the nearest million, if needed. a. Ending inventory $ million b. Cost of goods sold $ c. Net income before $ d. Retained earnings $ million $ million million 2. How much additional income tax would the company have paid if it had used FIFO instead of LIFO to value its inventory? Round to the nearest millions. million

Answer rating: 100% (QA)

1 a Ending Inventory Ending Inventory LIFOLIFO Reserve Year 2 162501500 17750 or 1775 million b C... View the full answer