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Andru [333]
3 years ago
8

Assume that a firm separately determined inventory under FIFO and LIFO and then compared the results. a. In each dropdown that f

ollows, select the correct sign [less than ( <), greater than (> ), or equal (=)] for each comparison, assuming periods of rising prices. 1. FIFO inventory LIFO inventory 2. FIFO cost of goods sold LIFO cost of goods sold 3. FIFO net income LIFO net income 4. FIFO income taxes LIFO income taxes b. Why would management prefer to use LIFO over FIFO in periods of rising prices? Income shown on the company’s tax return would be lower if LIFO rather than FIFO is used. Income shown on the company’s tax return would be higher if LIFO rather than FIFO is used. Cost of goods sold shown on the company’s income statement would be lower if LIFO rather than FIFO is used. Dividends shown on the company’s financial statements would be higher if LIFO rather than FIFO is used.
Business
1 answer:
marysya [2.9K]3 years ago
5 0

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.

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A ticket reseller purchases a ticket to a football game for $40 and offers it for sale at a price of $75. A consumer is willing
Burka [1]

Answer:

profit + consumer surplus.

Explanation:

The profit obtained by the reseller is given by the difference between the amount received on sale ($75) and the purchase price ($40). The consumer surplus is determined as the difference between the willingness to pay ($90) and the actual amount paid ($75). Therefore, the difference between $90 and $40 is the profit plus the consumer surplus.

7 0
3 years ago
Why is your amount owed considered when determining your credit score?
ankoles [38]

Answer:

Owing cash on credit accounts doesn't really mean you're a high-hazard borrower with a low credit Score. Notwithstanding, when a high level of an individual's accessible credit is been utilized, this can show that an individual is overextended, and is bound to make late or missed installments.

The amount owed on different accounts decides 30% of the FICO score. Aside from the general amount owed, the FICO scores think about the amount claimed freely on explicit accounts. On the off chance that you utilize a noteworthy part of the credit you are qualified for, it can negatively affect the FICO scores. Be that as it may, utilizing a less amount from as far as possible allowed can give you a superior score than not utilizing the credit by any stretch of the imagination.  

3 0
3 years ago
Summit Products, Inc. is interested in producing and selling an improved widget. Market research indicates that customers would
ladessa [460]

Answer:

b.$ 66

Explanation:

The question requires that Summit requires a return on sales of 25 %. To achieve that the cost of goods sold should be 75 %.

if the revised selling price is                                         $ 88

the target cost price would be ( $ 88 * 75 %)              % 66                

7 0
2 years ago
During the middle years of last decade, the exchange rate of the U.S. dollar has declined against the currencies of its major tr
Aleks04 [339]

Answer:

Because there are other factors that influence the weakening or strengthening of the dollar, not just the dollar exchange rate in relation to the exchange rates of other countries' currencies.

Explanation:

Although the United States has registered increases in the trade deficit, that is, when the country imports more goods and services from abroad than it exports, there are other factors that determine whether the country's currency is valued or not. In the case of the dollar, its value has not decreased despite the fall in the exchange rate of the dollar in relation to the currencies of its main trading partners due to the fact that the dollar is the main reserve currency in the world, which means that the dollar is the fashion of commercial transaction in the world, therefore its value is not lost in relation to other currencies, since several important transactions in the world such as gold and oil commodities are traded in dollars.

There is also the fact that the US attracts a lot of international investment for US Treasury bills, which helps to strengthen the dollar.

6 0
3 years ago
Match each economic scenario with the correct economic term.
kkurt [141]

Answer:

The answer is:

1 - Underutilization

2 - Efficiency

3 - Unattainability

Explanation:

Efficiency in economics means a situation in which all resources are optimally distributed to serve each entity in the best way while minimizing waste and inefficiency.

Underutilization in economics is also a a situation in which lesser resources are being utilized than the economy is capable of utilizing.

Unattainability is a situation in which what one to accomplish or achieve is not possible.

1 - Underutilization

2 - Efficiency

3 - Unattainability

6 0
3 years ago
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