16.The following information has been gathered about a firm:

 LIFO inventory = $10,000

 Beginning LIFO reserve = $2,500

 Ending LIFO reserve = $4,000

 LIFO Cost of goods sold = $15,000

 LIFO net income = $1,500

 Tax rate is 40%

What is the FIFO COGS?

A)   $16,500.

B)   $13,500.

C)   $11,000.

D)   $19,000.

17.The following information has been gathered about a firm:

 LIFO inventory = $10,000

 Beginning LIFO reserve = $2,500

 Ending LIFO reserve = $4,000

 LIFO Cost of goods sold = $15,000

 LIFO net income = $1,500

 Tax rate is 40%

What is the FIFO net income?

A)   $2,400.

B)   $4,000.

C)   $2,800.

D)   $1,500.

18.GR Corporation uses the last-in, first out (LIFO) method of accounting for inventory and $70,000 is reported as cost of goods sold (COGS) on their income statement. However, if GR had used first-in, first-out (FIFO), the COGS would have been $60,000. If the ending LIFO reserve (LR) reported in the financial statements is $40,000, the beginning LIFO reserve is:

A)   $50,000.

B)   $20,000.

C)   $30,000.

D)   $0.

19.Brigham Corporation uses the last-in, first-out (LIFO) method of accounting for inventory.  For the year 2005, the following is provided: 

 Cost of goods sold (COGS): $24,000

 Beginning inventory: $6,000

 Ending Inventory: $7,500

 The notes accompanying the financial statements indicate that the LIFO reserve at the beginning of the year was $2,250 and at the end of the year was $6,000.

If Brigham had used first-in, first-out (FIFO), the cost of goods sold for 2005 would be:

A)   $20,250.

B)   $3,750.

C)   $16,500.

D)   $29,250.

20.The formula to convert cost of goods sold (COGS) from last in, first out (LIFO) to first in, first out (FIFO) is:

A)   COGS FIFO = COGS LIFO – increase in the LIFO reserve.

B)   COGS FIFO = COGS LIFO + beginning LIFO reserve.

C)   COGS FIFO = COGS LIFO – beginning LIFO reserve.

D)   COGS FIFO = COGS LIFO – decrease in the LIFO reserve.

答案和详解如下：

16.The following information has been gathered about a firm:

 LIFO inventory = $10,000

 Beginning LIFO reserve = $2,500

 Ending LIFO reserve = $4,000

 LIFO Cost of goods sold = $15,000

 LIFO net income = $1,500

 Tax rate is 40%

What is the FIFO COGS?

A)   $16,500.

B)   $13,500.

C)   $11,000.

D)   $19,000.

The correct answer was B)

FIFO COGS = LIFO COGS – change in LIFO reserve

= $15,000 – (4,000 - 2,500) = $13,500

17.The following information has been gathered about a firm:

 LIFO inventory = $10,000

 Beginning LIFO reserve = $2,500

 Ending LIFO reserve = $4,000

 LIFO Cost of goods sold = $15,000

 LIFO net income = $1,500

 Tax rate is 40%

What is the FIFO net income?

A)   $2,400.

B)   $4,000.

C)   $2,800.

D)   $1,500.

The correct answer was A)

FIFO net income = LIFO net income + (change in LIFO reserve)(1-t)

= $1,500 + (4,000 - 2,500)(1-0.4) = $2,400

18.GR Corporation uses the last-in, first out (LIFO) method of accounting for inventory and $70,000 is reported as cost of goods sold (COGS) on their income statement. However, if GR had used first-in, first-out (FIFO), the COGS would have been $60,000. If the ending LIFO reserve (LR) reported in the financial statements is $40,000, the beginning LIFO reserve is:

A)   $50,000.

B)   $20,000.

C)   $30,000.

D)   $0.

The correct answer was C)

Beginning LR + ΔLR = Ending LR

ΔLR = COGS(LIFO) – COGS(FIFO) = $70,000 – 60,000 = $10,000

Beginning LR = $40,000 – 10,000 = $30,000

19.Brigham Corporation uses the last-in, first-out (LIFO) method of accounting for inventory.  For the year 2005, the following is provided: 

 Cost of goods sold (COGS): $24,000

 Beginning inventory: $6,000

 Ending Inventory: $7,500

 The notes accompanying the financial statements indicate that the LIFO reserve at the beginning of the year was $2,250 and at the end of the year was $6,000.

If Brigham had used first-in, first-out (FIFO), the cost of goods sold for 2005 would be:

A)   $20,250.

B)   $3,750.

C)   $16,500.

D)   $29,250.

The correct answer was A)

FIFO COGS = LIFO COGS - change in LIFO reserve. Therefore, $24,000 – ($6,000 – 2,250)  = $20,250.

20.The formula to convert cost of goods sold (COGS) from last in, first out (LIFO) to first in, first out (FIFO) is:

A)   COGS FIFO = COGS LIFO – increase in the LIFO reserve.

B)   COGS FIFO = COGS LIFO + beginning LIFO reserve.

C)   COGS FIFO = COGS LIFO – beginning LIFO reserve.

D)   COGS FIFO = COGS LIFO – decrease in the LIFO reserve.

The correct answer was A)

The formula for converting COGS from LIFO to FIFO is COGS_F = COGS_L-(LIFO reserve_E - LIFO reserve_B)