The following information comes from the 2013 Occidental Petroleum Corporation annual report to shareholders:
NOTE 4 INVENTORIES
Net carrying values of inventories valued under the LIFO method were approximately $205 million and $185 million at December 31, 2013 and 2012, respectively. Inventories consisted of the following: ($ in millions) The LIFO reserve indicates that inventories would have been $91 million and 101 million higher at the end of 2013 and 2012, respectively, if Occidental Petroleum had used FIFO to value its entire inventory.
Required:
If Occidental Petroleum had used FIFO to value its entire inventory how would its 2013 pre-tax income be affected?

Question

The following information comes from the 2013 Occidental Petroleum Corporation annual report to shareholders:
NOTE 4 INVENTORIES
Net carrying values of inventories valued under the LIFO method were approximately $205 million and $185 million at December 31, 2013 and 2012, respectively. Inventories consisted of the following: ($ in millions)  The LIFO reserve indicates that inventories would have been $91 million and 101 million higher at the end of 2013 and 2012, respectively, if Occidental Petroleum had used FIFO to value its entire inventory.
Required:
If Occidental Petroleum had used FIFO to value its entire inventory how would its 2013 pre-tax income be affected?

Quizplus · Accepted Answer

The Answer of The following information comes from the 2013 Occidental Petroleum Corporation annual report to shareholders:
NOTE 4 INVENTORIES
Net carrying values of inventories valued under the LIFO method were approximately $205 million and $185 million at December 31, 2013 and 2012, respectively. Inventories consisted of the following: ($ in millions)  The LIFO reserve indicates that inventories would have been $91 million and 101 million higher at the end of 2013 and 2012, respectively, if Occidental Petroleum had used FIFO to value its entire inventory.
Required:
If Occidental Petroleum had used FIFO to value its entire inventory how would its 2013 pre-tax income be affected?

The Following Information Comes from the 2013 Occidental Petroleum Corporation