Baker Corporation changed from the LIFO method to the FIFO method for inventory valuation during 2011. Baker has an effective income tax rate of 30 percent and 100,000 shares of common stock issued and outstanding. The following additional information is available: Assuming Baker makes the change in the first quarter of 2011, how much is reported as net income for the first quarter of 2011?
A) $492,000.
B) $494,800.
C) $500,000.
D) $505,200.
E) $527,950.

Question

Baker Corporation changed from the LIFO method to the FIFO method for inventory valuation during 2011. Baker has an effective income tax rate of 30 percent and 100,000 shares of common stock issued and outstanding. The following additional information is available:  Assuming Baker makes the change in the first quarter of 2011, how much is reported as net income for the first quarter of 2011?
A) $492,000. 
B) $494,800. 
C) $500,000. 
D) $505,200. 
E) $527,950.

Quizplus · Accepted Answer

The Answer of Baker Corporation changed from the LIFO method to the FIFO method for inventory valuation during 2011. Baker has an effective income tax rate of 30 percent and 100,000 shares of common stock issued and outstanding. The following additional information is available:  Assuming Baker makes the change in the first quarter of 2011, how much is reported as net income for the first quarter of 2011?
A) $492,000. 
B) $494,800. 
C) $500,000. 
D) $505,200. 
E) $527,950.

Baker Corporation Changed from the LIFO Method to the FIFO