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Reaction Technology is experiencing lower than expected performance for the year. The CFO has suggested that they steadily increase inventory volumes for the remainder of the year. What effect does this have on reported earnings? Do you agree with the CFO’s suggestion? Why or why not?
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For the month of January, Consolidated Engine Parts, Inc, had the following financial information: merchandise inventory, January 1, $322,000; merchandise inventory, January 31,$316,400; gross purchases,$243,460; purchase returns and allowances,$26,8..
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