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3 years ago

Which inventory method producess the lowest income tax during a period of inflation? A. LIFO B. FIFO c> Weighted-average

1 answer:

5 0

Hi there

The answer is
A. LIFO

the FIFO inventory costing method will produce a higher net income, and thus a higher tax liability, than the LIFO method

Hope it helps

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The use of simulation to create an aggregate plan:

12345 [234]

Answer:

Answer is option b i.e. will produce a plan that may not be the best plan.

Explanation:

Simulation is the technique used to create an artificial environment that is similar to the real-life situation to study various problems and how to tackle them. However, it is not the full proof plan which means it is based on certain probability and chances that a certain situation might arise. Many times situations are not as planned and here we cannot solely depend on the solution that we have learned during the simulation process. Therefore, the simulation will provide us with a plan that may or may not be the best plan.

6 0

3 years ago

Orion Iron Corp. tracks the number of units purchased and sold throughout each year but applies its inventory costing method at

balandron [24]

Answer:

Transactions Units Unit Cost

a. Inventory, Beginning 300 $ 14

b. Purchase, April 11 950 12

c. Purchase, June 1 850 15

d. Sale, May 1 (sold for $42 per unit) 300

e. Sale, July 3 (sold for $42 per unit) 630

f. Operating expenses (excluding income tax expense), $18,200

1 and 2) When you use a periodic inventory method, cost of goods available for sale and ending inventory are the same. They differ only when you use a perpetual inventory.

ending inventory = 1,170 units

Ending inventory under FIFO:

$28,350 - $11,760 = $16,590

Ending inventory under LIFO:

$28,350 - $13,710 = $14,640

Ending inventory under weighted average:

$28,350 - $12,555 = $15,795

3) total units sold = 930 units

COGS under FIFO:

(300 x $14) + (630 x $12) = $11,760

COGS under LIFO:

(850 x $15) + (80 x $12) = $13,710

COGS under weighted average:

($28,350 / 2,100) x 930 = $12,555

4) Income statement under FIFO

Sales revenue $39,060

COGS ($11,760)

Gross profit $27,300

Operating expenses ($18,200)

Operating income $9,100

Income statement under LIFO

Sales revenue $39,060

COGS ($13,710)

Gross profit $25,350

Operating expenses ($18,200)

Operating income $7,150

Income statement under weighted average

Sales revenue $39,060

COGS ($12,555)

Gross profit $26,505

Operating expenses ($18,200)

Operating income $8,305

6) FIFO minimizes operating income, therefore, minimizes income tax expense.

4 0

3 years ago

What type of rule defines how much time can pass between an illegal act and when an individual is prosecuted for that act?

Anton [14]

Answer: Statue of limitations is the correct answer

3 0

3 years ago

If consumers view the output of any firm in a market to be identical to the output of any other firm in the market, the demand c

Georgia [21]

Answer:

B. will be horizontal.

Explanation:

In the case when the firm is in the perfect competition market so here the demand curve would be horizontal as because of the same product and also the transaction cost is lesser that means if someone rise the prices so the producer would lost all its revenue

Therefore as per the given situation, the option b is correct

6 0

3 years ago

An investment offers a total return of 15 percent over the coming year. Janet Jello thinks the total real return on this investm

Sonbull [250]

Answer:

6.78%

Explanation:

Data provided in the question:

Total return i.e nominal rate = 15% = 0.15

Real return = 7.7% = 0.077

Now,

Inflation rate = $\frac{\textup{1 + Nominal rate}}{\textup{1 + Real return }}$ - 1

on substituting the respective values, we get

Inflation rate = $\frac{\textup{1 + 0.15}}{\textup{1 + 0.077}}$ - 1

Inflation rate = [ 1.15 ÷ 1.077 ] - 1

Inflation rate = 0.0678

Inflation rate = 0.0678 × 100% = 6.78%

6 0

3 years ago