Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. during 2019 (its first year of operations) and 202

During 2019 (its first year of operations) and 2020, Fieri Foods used the FIFO inventory...

70.2K

Verified Solution

Question

Accounting

During 2019 (its first year of operations) and 2020, Fieri Foods used the FIFO inventory costing method for both financial reporting and tax purposes. At the beginning of 2021, Fieri decided to change to the average method for both financial reporting and tax purposes. Income components before income tax for 2019, 2020, and 2021 were as follows: ($ in millions) 2019 2020 2021 Revenues $ 380 $ 390 $ 420 Cost of goods sold (FIFO) (38 ) (40 ) (46 ) Cost of goods sold (average) (52 ) (56 ) (62 ) Operating expenses (242 ) (250 ) (254 ) Dividends of $20 million were paid each year. Fieris fiscal year ends December 31. Required: 1. Prepare the journal entry at the beginning of 2021 to record the change in accounting principle. (Ignore income taxes.) 2. Prepare the 20212020 comparative income statements. 3. & 4. Determine the balance in retained earnings at January 1, 2020 as Fieri reported using FIFO method and determine the adjustment of balance in retained earnings a s on January 1, 2020 using average method instead of FIFO method.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Physics
1.2K views

In Bohr s stationary orbits a electrons do not move b electrons move emitting radiations...

Biology
1.2K views

Explain what you think the following quote means Apply it to Fahrenheit 451 and to...

Geometry
1.2K views

perimeter of the composite figure below semicircle Round to the nearest tenth Use 3 14...

Geometry
1.2K views

Choose all the statements that are TRUE about the vertical line through the point (1,4).The...

Statistics
1.2K views

A card is picked from the following cards Find the probability that the card drawn...

Statistics
1.2K views

rev The National Academy of Science reported that 32 of research in mathematics is published...

Calculus
1.2K views

Question Graph the Logarithmic Function y log z by plotting the Horizontal Intercept and one...

Accounting
1.2K views

Hyland Ltd commenced operation on 31 March 2020. The company balances its accounts at month-end...

Accounting
1.2K views

A company uses a process cost accorinting system using the weighted average cost flow assumption....

Accounting
1.2K views

Accounting Creations uses the FIFO Inventory Method in valuing inventory. The inventory balance of $425,000...

Accounting
1.2K views

Farahs Fine Fashions (FFF) works in the quirky fashion world. FFF can produce 10,000 dresses...

Accounting
1.2K views

on june 30 setzer corporation had a market price if $100 per share of common...