Question

Marigold Industries had the following inventory transactions occur during 2018: Units 2/1/18 Purchase 50 3/14/18 Purchase 95 5/1/18 Purchase 61 Cost/unit $40 $50 $54 The company sold 160 units at $80 each and has a tax rate of 40%. Assuming that a periodic inventory system is used, what is the company's after-tax income using FIFO?(rounded to whole dollars) O $4556 O $2980 O $3144 O $5240

Answer 1

Periodic : FIFO Goods Purchasd Cost of Goods Sold cost of Goods Cost Per Available for # of Units Cost Per Cost of # of Units Unit s ales sold Unit Goods Sold Feb-01 50 40.00 2000 50 40.00 2000 Mar-14 95 50.00 4750 951 50.00 4750 May-01 61 54.00 3294 15 54.00 810 Totals 206 48.76 10044 160 7560 Sales Revneue (160*80) Less : cost of Good Sold Gross Profit Less :Tax 40% After Tax inome 12800 7560 5240 2096 3144 Answer : $3144