Business, 06.11.2019 20:31 adriancastaneda

In its first year of operations, lima company manufactured 1,000 widgets, incurring direct materials and labor costs of $227,000. for book purposes, lima captialized $260,000 of indirect manufacturing costs. for tax purposes, it had to capitalize $315,000 of indirect costs under the unicap rules. at the end of the year, lima had 170 widgets remaining in inventory.

a. for book purposes, compute lima's ending inventory cost and cost of goods sold for the year.

b. for tax purposes, compute lima's ending inventory cost and cost of good sold for the year.

c. compute lima's inventory book/tax differences and indicate if such difference is favorable or unfavorable.

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In its first year of operations, lima company manufactured 1,000 widgets, incurring direct materials...