Wilma Company Began Operations in 2010 and Uses the Average

question 31

Multiple Choice

Wilma Company began operations in 2010 and uses the average cost method in costing its inventory.In 2011, Wilma is investigating a change to the LIFO method.Before making that determination, Wilma desires to determine what effect such a change will have on net income.Wilma has compiled the following information: Assume a 40% tax rate.
If Wilma adopted LIFO in 2011, net income would be

• A)$ 80, 000
• B)$116, 000
• C)$170, 000
• D)$224, 000

---

Definitions:

Federal Laws

Legislation enacted by the national government of a country that applies to the entire nation.

Westward Expansion

The 19th-century movement of settlers into the American West, encouraged by Manifest Destiny, land opportunity, and exploration.

Major Problems

Denotes significant challenges or obstacles that require attention and resolution.

Americans

Refers to the citizens or natives of the United States of America, characterized by a diverse cultural heritage and history.