10.00 points QP Corp. sold 5,330 units of its product at $46.70 per unit in year

Question

10.00 points QP Corp. sold 5,330 units of its product at $46.70 per unit in year 2015 and incurred operating expenses of $7.70 per unit in selling the units. It began the year with 770 units in inventory and made successive purchases of its product as follows. Jan. 1 Beginning inventory Feb. 20 Purchase May 16 Purchase Oct. 3 Purchase Dec. 11 Purchase 770 units $19.70 per unit 1,670 units$20.70 per unit 870 units $21.70 per unt 570 units $22.70 per unit 3.470 units$23.70 per unit Total 7.350 units Required 1. Prepare comparative income statements for the three inventory costing methods of FIFO, LIFO, and weighted average which includes a detailed cost of goods sold section as part of each statement. The company uses a periodic inventory system, and its income tax rate is 40%. (Round your average cost per unit to 2 decimal places.) OP CORP Income Statements Comparing FIFO, LIFO, and Weighted Average For Year Ended December 31, 2015 FIFO LIFO Sales Cost of goods sold: Inventory, Dec. 31, 2014 Cost of purchases Cost of goods available for sale Less: Inventory, Dec. 31, 2015 Cost of goods sold Gross profit Income before taxes Income taxes expense Net income

Explanation / Answer

QP CORP. Income Statements comparing FIFO, LIFO and Weighted Average For year Ended December 31, 2015 FIFO LIFO Weighted average Sales 248911 248911 248911 Cost of goods sold Inventory, Dec 31, 2014 15169 15169 15169 Cost of Purchases 148626 148626 148626 Cost of goods available for sale 163795 163795 163795 Less: Inventory, Dec 31, 2015 47874 40144 45016 Cost of Goods sold 115921 123651 118779 Gross Profit 132990 125260 130132 Expenses 41041 41041 41041 Income before taxes 91949 84219 89091 Income tax 36779.6 33687.6 35636.4 Net Income 55169.4 50531.4 53454.6

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