The following information pertains to the inventory of parvin company during year 2: jan. 1 beginning inventory 400 units @ $ 30 apr. 1 purchased 2,000 units @ $ 35 oct. 1 purchased 600 units @ $ 38 during year 2, parvin sold 2,700 units of inventory at $90 per unit and incurred $41,500 of operating expenses. parvin currently uses the fifo method but is considering a change to lifo. all transactions are cash transactions. assume a 30 percent income tax rate. parvin started the period with cash of $75,000, inventory of $12,000, common stock of $50,000, and retained earnings of $37,000. required a. record the above transactions in general journal form and post to t-accounts using (1) fifo and (2) lifo. use a separate set of journal entries and t-accounts for each method. (if no entry is required for a transaction/event, select "no journal entry required" in the first account field.)

Required a. Record the above transactions in general journal form and post to T-accounts using (1) FIFO and (2) LIFO. Use a separate set of journal entries and T-accounts for each method.

Explanation:

UnitsCostPriceCostPrice  

Begining Inventory40030  12.000    

purchase 12.00035  70.000    

purchase 260038      

Sales1.700  90  153.000  

FIFOUnitsCostSalePriceCostPriceCost of goods

Begining Inventory40030400  12.000  12000

purchase 12.000351300  70.000  45500

purchase 2600380  22.800  0

Sales  1.70090  153.00057500

 0    

LIFOUnitsCostSalePriceCostPriceCost of goods

Begining Inventory400300  12.000  0

purchase 12.000351.100  70.000  38500

purchase 260038600  22.800  22800

Sales  1.70090  153.00061300

 0    

FifoLifo      

Revenue153.000153.000      

Cost of goods5750061300      

Gross margin95.50091.700      

Expenses4150041500      

Ebit54.00050.200      

Tax rate30%30%      

Tax expense1620015060      

Net Income37.80035.140      

FiFO        

1        

Db Cash              153.000      

Cr Revenue               153.000      

2        

Db Cost of goods57500      

Cr Inventory                  57500      

3        

Db Expenses          41500      

Cr Cash                          41500      

4        

Db tax expense16200      

Cr cash                           16200      

LIFO        

1        

Db Cash             153.000      

Cr Revenue              153.000      

2        

Db Cost of goods61300      

Cr Inventory                 61300      

3        

Db Expenses           41500      

Cr Cash                           41500      

4        

Db tax expense15060      

Cr cash                          15060      

answercombination of ability and experience of the partners;

lawyer < 3 love yahh vic. imu