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Homework answers / question archive / Blossom Company began operations in 2018 and for simplicity reasons, adopted weighted-average pricing for inventory

Blossom Company began operations in 2018 and for simplicity reasons, adopted weighted-average pricing for inventory

Accounting

Blossom Company began operations in 2018 and for simplicity reasons, adopted weighted-average pricing for inventory. In 2020, in accordance with other companies in its industry, Blossom changed its inventory pricing to FIFO. The pretax income data is reported below. 
Weighted-Year Average FIFO 
2018 $382.100 $398,800 2019 398,700 426,900 2020 421,100 466,900 
Assume a 35% tax rate in all years. 

What is Blossom's net income in 2020? 

Compute the cumulative effect of the change in accounting principle from weighted-average to FIFO inventory pricing. 
Net effect $ 

(c) 
Show comparative income statements for Blossom Company. beginning with income before income tax, as presented on the 2020 income statement. 
Income before income tax Income tax Net income 
2020 


2019 


2018 


 

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