1. a large number of buyers and sellers
2. an identical or a homogeneous product
Answer and Explanation:
As per the data given in the question,
a)
1. FIFO inventory > LIFO inventory
(Because in case of LIFO recent purchases are considered in production first or sold first so the remaining inventory are old inventory which is less costlier.)
2. FIFO cost of goods sold < LIFO cost of goods sold
(Because in case of LIFO recent purchases are considered in production first which are expensive so the cost of production is greater than FIFO.)
3. FIFO net income > LIFO net income
(Because cost of production is less under FIFO and the value of closing inventory is high, therefore the net income is also high.)
4. FIFO income taxes > LIFO income taxes
(Since, income is high in FIFO, therefore the tax under FIFO will be higher.)
b)
Management would like prefer to use LIFO over FIFO in periods of rising prices because Income shown in the company's Tax return will be higher if we use FIFO rather than using LIFO.
Answer:
A) The income tax return for 2018 was filed on March 3, 2019. The three-year statute of limitations will begin to run on:
- April 16, 2019 (the next day after the tax deadline)
B) The income tax return for 2018 was filed on August 13, 2019. The statute of limitations will begin to run on:
- August 13, 2019 (the same day the taxes were filed)
C) The income tax return for 2018 was prepared on March 31, 2019, but was never filed. Through some misunderstanding between the preparer and the taxpayer, each expected the other to file the return. The statute of limitations:
- If the taxes were not filed, then the statute of limitations cannot begin to run.
D) The income tax return for 2018 was never filed because the taxpayer thought no additional tax was due. The statute of limitations:
- If the taxes were not filed, then the statute of limitations cannot begin to run.
Answer:
$46,525
Explanation:
Formula for ending retained earnings is as follows;
<em>Ending retained earnings = Beginning retained earnings + Net income - cash dividend</em>
Beg. RE = 44,800
Net income = 7,800
Cash dividends = 6,075
Plug in the values to the above formula;
Ending retained earnings = 44,800 + 7,800 - 6.075
Ending RE balance would be = $46,525
