The following information pertains to the inventory of Parvin Company during Year 2. Beginning Inventory Purchased...

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The following information pertains to the inventory of Parvin Company during Year 2. Beginning Inventory Purchased Purchased 300 units $37 2,900 units # $42 500 units $45 January 1 April 1 October 1 During Year 2, Parvin sold 3,500 units of inventory at $80 per unit and incurred $46,000 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. Parvin started the period with cash of $84,000, inventory of $11,100, common stock of $59,000. and retained earnings of $36,100. b. Prepare income statements using FIFO and LIFO. The following information pertains to the inventory of Parvin Company during Year 2. Beginning Inventory Purchased Purchased 300 units $37 2,900 units # $42 500 units $45 January 1 April 1 October 1 During Year 2, Parvin sold 3,500 units of inventory at $80 per unit and incurred $46,000 of operating expenses. Parvin currently uses the FIFO method but is considering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. Parvin started the period with cash of $84,000, inventory of $11,100, common stock of $59,000. and retained earnings of $36,100. b. Prepare income statements using FIFO and LIFO.

Answer rating: 100% (QA)

SOLUTION To prepare income statements using FIFO and LIFO we need to calculate the cost of goods sol... View the full answer