Question

1. Assume that AmerisourceBergen adjusts the LIFO reserve at the end of its quarter. Prepare the September 30, 2017, adjusting entry to record the cost of goods sold adjustment.2. If AmerisourceBergen had used FIFO to report its inventories, what would cost of goods sold have been for the quarter ended September 30, 2017?

Answer 1

Answer:

1. Sep 30, 2017

Dr LIFO reserve 158

Cr Cost of Goods sold 158

2. $148,756

Explanation:

1. Preparation for September 30, 2017, adjusting Journal entry to record the cost of goods sold adjustment

Sep 30, 2017

Dr LIFO reserve 158

Cr Cost of Goods sold 158

(To record Adjustment to cost of goods sold)

Calculation for cost of goods sold adjustment

Cost of goods sold=LIFO reserve in 2016 - LIFO reserve 2017

Cost of goods sold= $1,625 - $1,467

Cost of goods sold= $158

2. Calculation for what cost of goods sold would have been for the quarter ended September 30,

FIFO Cost of goods sold = (Income statement Cost of goods sold + LIFO reserve)

FIFO Cost of goods sold= $148,598 + $158

FIFO Cost of goods sold=$148,756

Therefore what cost of goods sold would have been for the quarter ended September 30 is $148,756