Solution-Calculate the amount to report for cost of goods

Calculate the amount to report for cost of goods sold

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Reference no: EM132935756

Taylor Corporation reports inventory and cost of goods sold based on calculations from a LIFO periodic inventory system. The company's records under this system reveal the following inventory layers at the beginning of 2021 (listed in chronological order of acquisition):

12,500 units @ $20 $250,000
17,500 units @ $25 437,500
Beginning inventory $687,500

During 2021, 35,000 units were purchased for $30 per unit. Due to unexpected demand for the company's product, 2021 sales totaled 43,000 units at various prices, leaving 22,000 units in ending inventory.

Req:

Problem 1. Calculate the amount to report for cost of goods sold for 2021.

Problem 2. Determine the amount of LIFO liquidation profit that the company must report in a disclosure note to its 2021 financial statements. Assume an income tax rate of 25%.

Problem 3. If the company decided to purchase an additional 8,000 units at $30 per unit at the end of the year, how much income tax currently payable would be saved?

Reference no: EM132935756

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Calculate the amount to report for cost of goods sold

Reference no: EM132935756

Reference no: EM132935756

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