Income statement and balance sheet information abstracted from a recent annual report of Wolverine World Wide,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Income statement and balance sheet information abstracted from a recent annual report of Wolverine World Wide, Incorporated, appears below: Balance Sheets ($ in millions) December 28, 2019 December 29, 2018 Current assets: Inventories $ 348.2 $ 317.6 Income Statements ($ in millions) For the Year Ended December 28, 2019 December 29, 2018 Net sales Cost of goods sold Gross profit $ 2,273.7 1,349.9 $ 923.8 $ 2,239.2 1,317.9 $ 921.3 The significant accounting policies note disclosure contained the following: Inventories The Company used the LIFO method to value inventories of $81.2 million and $61.1 million at December 28, 2019, and December 29, 2018, respectively. During fiscal years 2019 and 2018, a reduction in inventory quantities resulted in a liquidation of applicable LIFO inventory quantities carried at lower costs in prior years. This LIFO liquidation decreased cost of goods sold by $0.4 million and $4.6 million, respectively. If the FIFO method had been used, inventories would have been $11.4 million and $11.8 million higher than reported at December 28, 2019, and December 29, 2018, respectively. Required: 1. Is Wolverine disclosing the FIFO cost of its LIFO inventory? 2. Calculate what beginning inventory and ending inventory would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. 3. Calculate what cost of goods sold and gross profit would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. 4. In 2019, Wolverine reported a LIFO liquidation. Did this liquidation increase or decrease cost of goods sold in 2019? Does this indicate that inventory costs have been increasing or decreasing over time? Calculate what beginning inventory and ending inventory would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. Note: Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place. Beginning inventory Ending inventory million million Calculate what cost of goods sold and gross profit would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. Note: Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place. Cost of goods sold Gross profit million million In 2019, Wolverine reported a LIFO liquidation. Did this liquidation increase or decrease cost of goods sold in 2019? Does this indicate that inventory costs have been increasing or decreasing over time? Did this liquidation increase or decrease cost of goods sold in 2019? Does this indicate that inventory costs have been increasing or decreasing over time? Income statement and balance sheet information abstracted from a recent annual report of Wolverine World Wide, Incorporated, appears below: Balance Sheets ($ in millions) December 28, 2019 December 29, 2018 Current assets: Inventories $ 348.2 $ 317.6 Income Statements ($ in millions) For the Year Ended December 28, 2019 December 29, 2018 Net sales Cost of goods sold Gross profit $ 2,273.7 1,349.9 $ 923.8 $ 2,239.2 1,317.9 $ 921.3 The significant accounting policies note disclosure contained the following: Inventories The Company used the LIFO method to value inventories of $81.2 million and $61.1 million at December 28, 2019, and December 29, 2018, respectively. During fiscal years 2019 and 2018, a reduction in inventory quantities resulted in a liquidation of applicable LIFO inventory quantities carried at lower costs in prior years. This LIFO liquidation decreased cost of goods sold by $0.4 million and $4.6 million, respectively. If the FIFO method had been used, inventories would have been $11.4 million and $11.8 million higher than reported at December 28, 2019, and December 29, 2018, respectively. Required: 1. Is Wolverine disclosing the FIFO cost of its LIFO inventory? 2. Calculate what beginning inventory and ending inventory would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. 3. Calculate what cost of goods sold and gross profit would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. 4. In 2019, Wolverine reported a LIFO liquidation. Did this liquidation increase or decrease cost of goods sold in 2019? Does this indicate that inventory costs have been increasing or decreasing over time? Calculate what beginning inventory and ending inventory would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. Note: Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place. Beginning inventory Ending inventory million million Calculate what cost of goods sold and gross profit would have been for the year ended December 28, 2019, if Wolverine had used FIFO for all of its inventories. Note: Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place. Cost of goods sold Gross profit million million In 2019, Wolverine reported a LIFO liquidation. Did this liquidation increase or decrease cost of goods sold in 2019? Does this indicate that inventory costs have been increasing or decreasing over time? Did this liquidation increase or decrease cost of goods sold in 2019? Does this indicate that inventory costs have been increasing or decreasing over time?
Expert Answer:
Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
Posted Date:
Students also viewed these accounting questions
-
Income statement and balance sheet information abstracted from a recent annual report of Wolverine World Wide, Inc. appears below: The significant accounting policies note disclosure contained the...
-
Income statement and balance sheet information abstracted from a recent annual report of Wolverine World Wide, Inc., appears below: The significant accounting policies note disclosure contained the...
-
. Current price of stock is $20 and expected price after one year is 22.5. If investor required return is 18%. What percentage of dividend should company pay?
-
Obtain Vo in the circuit of Fig. 10.126 using PSpice. 2V. j42 2 , 3/0 A
-
Find the word or phrase from the list below that best matches the description in the following questions. Use the numbers to the left of words in the answer. Each answer should be used only once. A...
-
What is creativity?
-
Standard Company has developed standard manufacturing overhead costs based on a capacity of 180,000 direct labor hours as follows: Standard overhead costs per unit: Variable portion 2 hours @ $3 = $...
-
what happens when ou use an aggregation function in a calculated column?
-
Illustrate the output of the following statements: a = MidA () a.methodA (4) a.methodB (a, 99)
-
At Wandas fish store, packers wages increase to $17.50 an hour, but the price of fish remains at $1 a pound. a. What happens to the value of marginal product of labor? b. What happens to Wandas...
-
The product life cycle is more likely to mislead marketing management than provide useful insights. Discuss.
-
How would the changes cited in the news clip change the U.S. Gini ratio? President Biden wants to reverse the widening racial income and wealth gaps. The Biden budget includes funding for early...
-
Snodgrass, a minority shareholder in the 21st Century Broadcasting Network, Inc., was dissatisfied with managements decision to cancel several long-running news shows and r e place them with several...
-
Outline the main stages in the marketing research process, identifying particularly the kinds of difficulties that might be faced at each stage.
-
How virtual team leadership is the same and different than traditional team leadership?
-
Pedro Bourbone is the founder and owner of a highly successful small business and, over the past several years, has accumulated a significant amount of personal wealth. His portfolio of stocks and...
-
(a) Are the accelerations of the motions shown in Figure 4.1 constant? (b) For which surface is the acceleration largest in magnitude? Figure 4.1 Velocity-versus-time graph for a wooden block sliding...
-
What is the change in velocity of \((a)\) cart 1 (b) cart 2 in Figure 4.6? (c) What do you notice about your two answers? Figure 4.6 Velocity-versus-time graph for two identical carts before and...
-
The \(x\) component of the final velocity of the standard cart in Figure 4.8 is positive. Can you make it negative by adjusting this cart's initial speed while still keeping the half cart initially...
Study smarter with the SolutionInn App