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Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello
Edition 16ISBN: 978-0077862381Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello
Edition 16ISBN: 978-0077862381 Exercise 5
Notes to the financial statements of two clothing manufacturers follow:
Inventories: The inventories are slated at the lower of cost, determined principally by the LIFO method, or market.
Inventories: Inventories are stated at the lower of cost (first-in, first-out method) or market value, assuming a period of rising prices.
a.hich company is using the more conservative method of pricing its inventories Explain.
b.n the basis of the inventory methods in use in their financial statements, which company is in the better position to minimize the amount of income taxes that it must pay Explain.
c.ould either company increase its cash collections from customers or reduce its cash payments to suppliers of merchandise by switching from FIFO to LIFO, or from LIFO to FIFO Explain.
Inventories: The inventories are slated at the lower of cost, determined principally by the LIFO method, or market.
Inventories: Inventories are stated at the lower of cost (first-in, first-out method) or market value, assuming a period of rising prices.
a.hich company is using the more conservative method of pricing its inventories Explain.
b.n the basis of the inventory methods in use in their financial statements, which company is in the better position to minimize the amount of income taxes that it must pay Explain.
c.ould either company increase its cash collections from customers or reduce its cash payments to suppliers of merchandise by switching from FIFO to LIFO, or from LIFO to FIFO Explain.
Explanation
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a.The company, which is using LIFO metho...
Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello
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