Please see attached questions. Tantras Co. deckles at the beginning or 201-1 to

Question

Please see attached questions.

Tantras Co. deckles at the beginning or 201-1 to adopt the FIFO method or inventory valuation. Tarvers had used the UFO method Tor financial repotting since its inception on January 1, 2012, and had maintained records adequate to apply the FIFO method retrospectively. taverns concluded that FIFO is. the preferable inventory method because it reflects the current cost of inventory on the balance sheet. The table presents the effects of the change in accounting principle on inventory and cost of goods sold. Prepare income statements under UFO for 2012. 2013. and 2014.

Explanation / Answer

Answer (a) Income Statement (LIFO)

Answer (b) Income Statement (FIFO)

Answer (c) Income statement reflecting the retrospective application of the accounting change from lifo to FIFO

Working Note

Answer (d)

Particulars 2012 2013 2014 Sales $4,187 $4,187 $4,187 Less: Cost of Goods Sold -$783 -$1,004 -$1,135 Less: Operating Expenses -$1,017 -$1,017 -$1,017 Net Income $2,387 $2,166 $2,035

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