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laiz [17]
3 years ago
12

On January 1, 2018, Frost Corp. changed its inventory method to FIFO from LIFO, for both financial and income tax reporting purp

oses. The change resulted in a $900,000 increase in the January 1, 2018 inventory. Assume that the income tax rate for all years is 30%. The cumulative effect of the accounting change should be reported by Frost in its 2018 ________.
a. retained earnings statement, as a $630,000 addition to the beginning balance
b. income statement, as a $630,000 cumulative effect of accounting change
c. retained earnings statement, as a $900,000 addition to the beginning balance
d. income statement, as a $900,000 cumulative effect of accounting change
Business
1 answer:
fiasKO [112]3 years ago
4 0

Answer:

a. retained earnings statement, as a $630,000 addition to the beginning balance

Explanation:

Data provided in the question

Change in increase in inventory = $900,000

Income tax rate = 30%

By considering the above information, the cumulative effect is

= Change in increase in inventory - Change in increase in inventory × income tax rate

= $900,000 - $900,000 × 30%

= $900,000 - $270,000

= $630,000

This $630,000 is a addition to the beginning balance

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anyanavicka [17]

Answer:

C) WIP InventoryWIP Inventory-Finishing

Explanation:

Cost of WIP is transferred through Molding to Coloring to the last process of the production finishing. After completing the finishing the balls are ready and the cost is transferred from WIP InventoryWIP Inventory-Finishing to Finished goods Inventory. So, the correct answer is C) WIP InventoryWIP Inventory-Finishing.

5 0
3 years ago
Rose decides she wants to begin her own business, marketing toward online game players. Which of the following best answers the
marta [7]
The best option is B Paint Space game Online character portraits to sell on her website.

Rose decides she wants to begin her own business, marketing toward online game players. The statement which best describe the economic question What to produce is Paint Space game Online character portraits to sell on her website.

3 0
3 years ago
The chief executive officer earns $20,000 per month. as of may 31, her gross pay was $100,000. the tax rate for social security
omeli [17]

The total is $1,437.

Before June she had already paid social security on $100,000 in earnings. So, in June she only needs to pay social security on $18,500.

$18,500 x .062 = $1,147

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The total amount of FICA -social security withheld from this employee in June is $290 + $1,147 = $1,437

5 0
3 years ago
Read 2 more answers
Zoe runs a flower shop. She recently made some changes so that one employee answers phones and completes the order and payment p
jeyben [28]

Answer:

The correct answer is (e)

Explanation:

Task identity is a complete system that involves doing a job and specifying every phase and step from start to finish that helps to attain noticeable result and helps to avoid confusion. It not only helps the company to find the best person for a job, but it also allows employees to achieve satisfaction at their job.

8 0
2 years ago
During the year, Mark reports $90,000 of active business income from his law practice. He also owns two passive activities. From
andrezito [222]

Answer:

b. $90,000 with a $10,000 loss carryover

Explanation:

Given that

Active business income = $90,000

From Activity A, the income earns = $20,000

From Activity B, the loss incurs = $30,000

So by considering the above information, the Adjusted gross income should be

The $90,000 should be recorded

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The $10,000 loss is come from

= $20,000 - $30,000

= -$10,000

8 0
3 years ago
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