The management of Tritt Company has asked its accounting department to describe
ID: 2500315 • Letter: T
Question
The management of Tritt Company has asked its accounting department to describe the effect upon the company’s financial position and its income statements of accounting for inventories on the LIFO rather than the FIFO basis during 2014 and 2015. The accounting department is to assume that the change to LIFO would have been effective on January 1, 2014, and that the initial LIFO base would have been the inventory value on December 31, 2013. Presented below are the company’s financial statements and other data for the years 2014 and 2015 when the FIFO method was employed.
Financial Position as of
12/31/13
12/31/14
12/31/15
Income for Years Ended
12/31/14
12/31/15
Other data:
Name the account(s) presented in the financial statements that would have different amounts for 2015 if LIFO rather than FIFO had been used, and state the new amount for each account that is named.
Account
New amount
for 2015
Financial Position as of
12/31/13
12/31/14
12/31/15
Cash $ 91,190 $131,090 $155,420 Accounts receivable 81,700 101,810 121,130 Inventory 121,130 141,050 177,610 Other assets 161,110 171,170 201,300 Total assets $455,130 $545,120 $655,460 Accounts payable $ 41,840 $ 61,490 $ 81,700 Other liabilities 70,830 81,030 110,730 Common stock 201,300 201,300 201,300 Retained earnings 141,160 201,300 261,730 Total liabilities and equity $455,130 $545,120 $655,460Explanation / Answer
The management of Tritt Company has asked its accounting department to describe
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.