A) C) Determine the cash flow from operating activities under FIFO and LIFO. (Ro

Question

A)

C) Determine the cash flow from operating activities under FIFO and LIFO. (Round intermediate calculations and final answers to the nearest whole dollar amount. Amounts to be deducted should be indicated with minus sign.)

Chrome File Edit View History Bookmarks People Window Help G -' 29% D Tue 8:28 PM Ayah Mansour E k To Nature on C Chegg St e File Edit View H Secure https:newconnect.mheducation.com/flow/connect.html a t oogle 1 The Sociological NBA.com @ Home GradesFirst E ESPN: The World IRIT Online Main Home Chegg.com . Target * BenefitHub D Nike Women's Sp Netflix Blackboard take home chapter 5- 5-21 Help Save & Exit Submit Saved Check my work Required information The following ifarmation applies to the questions displayed below The following information pertains to the Inventory of Parvin Company Part 1 of 3 10 poits Tan. ining inventory Apr. 1Farchased 400 unit 17 2,500 units$22 L,000 unita23 During 2018, Parvin sold 3,315 units of inventory at $41 per unit and incurred $17,400 of operating expenses. Parvin currently uses the FIFO method but is consldering a change to LIFO. All transactions are cash transactions. Assume a 30 percent income tax rate. Parvin started the period with cesh of $127,200, inventory of$6,800, common stock of $110,000, and retained eamings of $24,000. Print a. Prepare Income statements using FIFO and LIFO. (Round Intermedlate calculations and final answers to the nearest whole dollar Income Statements For tho Year Endod Docomber 31, 2018 FIFO LIFO Income before tax Prev 123013Next > 20

Explanation / Answer

Cost of Goods Available for Sale Date Explanation Units Unit Cost Total 1-Jan Op. Inventory                 400              17.00            6,800 1-Apr Purchases             2,500              22.00          55,000 1-Oct Purchases             1,000              23.00          23,000 Total             3,900          84,800 Ending Inventory (In Units) = 3,900 Units - 3,315 Units = 585 Units LIFO Method Value of Ending Inventory Date Units Unit Cost Total Cost 1-Jan                      400             17.00              6,800 1-Apr                      185             22.00              4,070 Total                      585            10,870 FIFO Method Value of Ending Inventory Date Units Unit Cost Total Cost 1-Oct                      585                   23            13,455 Total                      585            13,455 Amt. of Goods Available for Sale Ending Inventory Cost of Goods Sold LIFO                              84,800                        10,870                  73,930 FIFO                              84,800                        13,455                  71,345 Answer a. PARVIN COMPANY Income Statements For the Year Ended Dec 31, 2018 FIFO LIFO Sales -3,315 Units X $41                           135,915                      135,915 Cost of Goods Sold                              71,345                        73,930 Gross Margin                              64,570                        61,985 Operating Expense                              17,400                        17,400 Net Operating Income                              47,170                        44,585 Income Tax - 30%                              14,151                        13,376 Net Income                              33,019                        31,209

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