Gerald Co. decided to switch from the FIFO method of costing inventories to the average cost...

Transcribed Image Text:

Gerald Co. decided to switch from the FIFO method of costing inventories to the average cost method at the beginning of 2016. At December 31, 2015, Gerald's inventory using FIFO was $37,650. Gerald inventory using average cost would have been $40,220. Gerald's tax rate is 30%. What is the change to Inventory? Indicate the amount and whether Inventory would be debited (D) or Credited (C). Answer with the amount and either a D or C right beside the amount (no space. Example: if your answer is $1,000 debit, put 1,000D Gerald Co. decided to switch from the FIFO method of costing inventories to the average cost method at the beginning of 2016. At December 31, 2015, Gerald's inventory using FIFO was $37,650. Gerald inventory using average cost would have been $40,220. Gerald's tax rate is 30%. What is the change to Inventory? Indicate the amount and whether Inventory would be debited (D) or Credited (C). Answer with the amount and either a D or C right beside the amount (no space. Example: if your answer is $1,000 debit, put 1,000D

Answer rating: 100% (QA)

Answer Retained Earnings Credit 1799C Answer Explanation ... View the full answer