Homework answers / question archive / The management of Sandhill Company SE is reevaluating the appropriateness of using its present inventory cost flow method

The management of Sandhill Company SE is reevaluating the appropriateness of using its present inventory cost flow method

Accounting

Share With

The management of Sandhill Company SE is reevaluating the appropriateness of using its present inventory cost flow method. The company requests your help in determining the results of operations for 2017 if either the FIFO or the average cost method had been used. For 2017, the accounting records show these data: mento Purchases and sales Seginning (10,240 units) 1,700 Total net sales (240,640 units) 0990,400 ning (19.200 unit) Total cost of goods purchased (249,600 units) 724,064 Purchases were made quarterly as follows 1 its 4,000 51.200 57,600 76.800 249,600 02.64 2.54 2.94 3.14 Tatal Cast C168,960 145,400 169,344 241,152 C724,064 Operating expenses were C147,900, and the company's income tax rate is 35%
Condensed Thcome statement For the Year Ended December 31, 2017 FIFO Average-cost 998,400 998,400 Sales Revenues Cost of Goods Sold s Beginning inventory 31,700 31,700 Cost of Goods Purchased 724,864 724,864 Cost of Goods Available for Sale 756564 756564 Ending Inventory 60288 55891 X Cost of Goods Sold 696276 700673 X Gross Profit 302124 297897 Operating Expenses 147.900 147,900 Income before Income Taxes 154224 149997 X Income Tax Expense 53978 52499 Net Income / (Loss) 100246 97498