Spando Apparel uses the LIFO inventory method for external reporting and for income tax purposes...
70.2K
Verified Solution
Link Copied!
Question
Accounting
Spando Apparel uses the LIFO inventory method for external reporting and for income tax purposes but maintains its internal records using FIFO. The following disclosure note was included in a recent annual report: Inventories ($ in millions):
| 2021 | 2020 | |||||||
| Total inventories | $ | 649 | $ | 628 | ||||
| LIFO reserve | (99 | ) | (59 | ) | ||||
| $ | 550 | $ | 569 | |||||
The companys income statement reported cost of goods sold of $3,200 million for the fiscal year ended December 31, 2021. Required: 1. Spando adjusts the LIFO reserve at the end of its fiscal year. Prepare the December 31, 2021, adjusting entry to record the cost of goods sold adjustment. 2. If Spando had used FIFO to value its inventories, what would cost of goods sold have been for the 2021 fiscal year?
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!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.