In what ways would a reduction in inventory help the company

Assignment Help Accounting Basics
Reference no: EM133024841

Question - An executive in a merchandising company receives an annual bonus equal to 5% of net income. Historically, the company has calculated the cost of goods sold and ending inventory using LIFO and has maintained 30,000 units in inventory for the last 10 years. The executive is recommending the company reduce the number of units in year-end inventory to 1,000. Over the 10-year period, the cost per unit of inventory has increased from $60 per unit to $110 per unit.

Respond to the following in a minimum of 175 words:

In what ways would a reduction in inventory help the company?

In what ways would the change from LIFO to FIFO help the executive personally?

Would you approve the proposal to move from LIFO to FIFO? Why or why not?

Reference no: EM133024841

Questions Cloud

What is the firm taxable income : Question - Corporate Tax Liability The Talley Corporation had taxable operating income of $305,000. What is the firm taxable income
Case-toyota motor corporation : Toyota Motor Corporation took extraordinary care in developing the channel and selecting the dealers for its Lexus luxury cars.
Couriers and local delivery services : During BUSN303, you will complete 4 research exercises to prepare you for success in the course-long Competitive Analysis project.
Calculate the employee bc pension plan contribution : Question - Joelle works in BC and her bi-weekly earnings are $1,700.00. Calculate the employee's BC Pension Plan Contribution
In what ways would a reduction in inventory help the company : In what ways would a reduction in inventory help the company? In what ways would the change from LIFO to FIFO help the executive personally
Why unethical and often illegal practice : a) Briefly describe the five types of ethical threats in the IFAC code of professional ethics (2009) and discuss how accepting excessive 'gifts' or 'hospitality
Determine the amount to be received by bb : Sales for the period were as follows: BB, P170,000; WW, P260,000; FF, P60,000. Determine the amount to be received by BB
Developing a request for staff feedback : Developing a request for staff feedback and analysing staff feedback on change management process Analysing themselves and the impact across the organisation us
Applying for start-up funding : You are starting up a freelance or consulting business and are applying for start-up funding through a private investment firm.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd