Answer:
B. Decrease $19,000
Explanation:
The computation of the amount affect the operating income is shown below
But before that first we need to find the new operating income
Total operating income for Cat Food $280,000
Less: Fixed costs for Dog Food ($52000)
Add: rented per year $26000
New net operating income $254000
Now decrease in net operating income is
= operating income - new operating income
= $273,000 - $254,000
= $19,000
Answer and Explanation:
1. Journal Entries
July 15 Accounts Receivable $66,000
Sale Revenue $66,000
July 23 Cash $64,680
Sales discount 1320
Accounts Receivable 66,000
2. Journal Entries
July 15 Accounts Receivable $66,000
Sale Revenue $66,000
August 15 Cash $66,000
Accounts Receivable 66,000
Answer:
(a) $1,760
(b) $1,100
Explanation:
Given that,
Skysong, Inc. made three purchases of merchandise:
(1) 320 units at $5
(2) 420 units at $7
(3) 520 units at $8
Units on hand at the end of the period = 220
(a) Under FIFO method,
cost of ending inventory:
= Units on hand at the end of the period × $8 (From the last purchase)
= 220 × $8
= $1,760
(b) Under LIFO method (Comprise units from the first purchase),
cost of ending inventory:
= Units on hand at the end of the period × $8 (From the first purchase)
= 220 × $5
= $1,100