Prepare comparative statements for the 5 years, assuming that Cheyenne changed its method of inventory pricing to average-cost. Indicate the effects on net income and earnings per share for the years involved. Cheyenne Instruments started business in 2015. Assume that the number of shares outsanding is 100. (Enter amounts that decrease cost of goods sold using either a negative sign preceding the number e.g. -15,000 or parentheses e.g. (15,000). Round all amounts except EPS to the nearest whole dollar, e.g. 5,275. Round Earnings Per Share to 2 decimal places, e.g. 1.62. Round up the tax effects to the next whole dollar.)

CHEYENNE INSTRUMENT COMPANY Statement of Income and Retained Earnings For the Years Ended May 31
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The management of Cheyenne Instrument Company had concluded with the concurrence of its independent auditors, that results of operations would be more fairly presented if Cheyenne changed its method of pricing inventory from last-in, first-out (LIFO) to average-cost in 2020. Given below is the 5-year summary of income under LIFO and a schedule of what the inventories would be if stated on the average-cost method. 2020 $18,930 CHEYENNE INSTRUMENT COMPANY STATEMENT OF INCOME AND RETAINED EARNINGS FOR THE YEARS ENDED MAY 31 2016 2017 2018 2019 Sales-net $14,060 $15,510 $16,680 $18,380 Cost of goods sold Beginning inventory 1,010 1.110 1.010 1.120 Purchases 13,050 13,960 14,890 16,000 Ending inventory (1,110) (1,010) (1,120) (1.230) Total 12,950 14,060 14,780 15,890 Gross profit 1.110 1.450 1.900 2.490 Administrative expenses 700 770 840 910 Income before taxes 410 680 1,060 1,580 Income taxes (50%) 205 340 530 790 Net income 205 340 530 790 Retained earnings-beginning 1,200 1,405 1.745 2,275 Retained earnings-ending $1,405 $1,745 $2,275 $3.065 Earnings per share $2.05 $3.40 $5.30 $7.90 1.230 17,620 (1,360) 17.490 1,440 1.000 440 220 220 3,065 $3,285 $2.20 SCHEDULE OF INVENTORY BALANCES USING AVERAGE-COST METHOD FOR THE YEARS ENDED MAY 31 2015 2016 2017 2018 2019 2020 $1.020 $1,130 $1,130 $1,280 $1,490 $1,710 Prepare comparative statements for the 5 years, assuming that Cheyenne changed its method of inventory pricing to average-cost. Indicate the effects on net income and earnings per share for the years involved. Cheyenne Instruments started business in 2015. Assume that the number of shares outsanding is 100. (Enter amounts that decrease cost of goods sold using either a negative sign preceding the number eg.-15,000 or parentheses eg. (15,000). Round all amounts except EPS to the nearest whole dollar, eg. 5,275. Round Earnings Per Share to 2 decimal places, e.g. 1.62. Round up the tax effects to the next whole dollar.) The management of Cheyenne Instrument Company had concluded with the concurrence of its independent auditors, that results of operations would be more fairly presented if Cheyenne changed its method of pricing inventory from last-in, first-out (LIFO) to average-cost in 2020. Given below is the 5-year summary of income under LIFO and a schedule of what the inventories would be if stated on the average-cost method. 2020 $18,930 CHEYENNE INSTRUMENT COMPANY STATEMENT OF INCOME AND RETAINED EARNINGS FOR THE YEARS ENDED MAY 31 2016 2017 2018 2019 Sales-net $14,060 $15,510 $16,680 $18,380 Cost of goods sold Beginning inventory 1,010 1.110 1.010 1.120 Purchases 13,050 13,960 14,890 16,000 Ending inventory (1,110) (1,010) (1,120) (1.230) Total 12,950 14,060 14,780 15,890 Gross profit 1.110 1.450 1.900 2.490 Administrative expenses 700 770 840 910 Income before taxes 410 680 1,060 1,580 Income taxes (50%) 205 340 530 790 Net income 205 340 530 790 Retained earnings-beginning 1,200 1,405 1.745 2,275 Retained earnings-ending $1,405 $1,745 $2,275 $3.065 Earnings per share $2.05 $3.40 $5.30 $7.90 1.230 17,620 (1,360) 17.490 1,440 1.000 440 220 220 3,065 $3,285 $2.20 SCHEDULE OF INVENTORY BALANCES USING AVERAGE-COST METHOD FOR THE YEARS ENDED MAY 31 2015 2016 2017 2018 2019 2020 $1.020 $1,130 $1,130 $1,280 $1,490 $1,710 Prepare comparative statements for the 5 years, assuming that Cheyenne changed its method of inventory pricing to average-cost. Indicate the effects on net income and earnings per share for the years involved. Cheyenne Instruments started business in 2015. Assume that the number of shares outsanding is 100. (Enter amounts that decrease cost of goods sold using either a negative sign preceding the number eg.-15,000 or parentheses eg. (15,000). Round all amounts except EPS to the nearest whole dollar, eg. 5,275. Round Earnings Per Share to 2 decimal places, e.g. 1.62. Round up the tax effects to the next whole dollar.)