Example 3:11/2/2020 home
Example 3:11/2/2020 home
Completion requirements
Opened: Tuesday, 11 February 2020, 12:00 AM
Due: Tuesday, 18 February 2020, 12:00 AM
During 2016, Baker Company and Baumer Company made the following identical purchases:
•100
units @$10.00
•200
units @$10.50
•200
units @$11.50
•200 units
@ $12.00
Each company sold 350 units, but Baker uses LIFO inventory valuation and Baumer uses FIFO inventory valuation. Assume there was no beginning inventory.
a. Calculate ending inventory and cost of goods sold for each company
b. How will the difference in cost of goods sold affect net income?