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ACC - Shamu Corp.

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Question;Shamu Corp. began operations in 2013, and switched from using the weighted-average inventory assumption to using FIFO in 2014. 2014 ending inventory has already been calculated to be $85,000 using FIFO (but cost of goods sold for 2014 may still need adjustment). Had Shamu used FIFO in 2012, cost of good sold would have been $60,000 instead of $63,000.Ignoring income taxes, what journal entry is needed to adjust the 2014 books to reflect this change? Assume that the 2014 closing entries have not yet been made. Hint: the ending inventory for 2014 is correct, and does not need adjustment. But the journal entry must balance.

 

Paper#39926 | Written in 18-Jul-2015

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