Hogan Industries Had the Following Inventory Transactions Occur During 2017

question 76

Multiple Choice

Hogan Industries had the following inventory transactions occur during 2017: $\begin{array}{rlll}&&\text { Units } & \text { Cost/unit } \\\text { Feb. 1,2017 } & \text { Purchase } & 108 & \$ 45 \\\text { Mar. 14,2017 } & \text { Purchase } & 186 & \$ 47 \\\text { May } 1,2017 & \text { Purchase } & 132 & \$ 49\end{array}$ The company sold 306 units at $63 each and has a tax rate of 30%. Assuming that a periodic inventory system is used and operating expenses of $1,800, what is the company's after-tax income using FIFO? (rounded to whole dollars)

• A)$2,832
• B)$3,288
• C)$2,302
• D)$1,982

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Definitions:

Investment Turnover

A measure of the activity or liquidity of an investment portfolio, indicating how frequently assets within the portfolio are bought and sold.

Return On Investment

A measure of the profitability and efficiency of an investment, calculated as net profit divided by the cost of the investment.

Invested Assets

Assets that have been purchased or acquired for the purpose of generating income or profit, not for immediate resale.

Minimum Return

The lowest acceptable rate of return on an investment that a manager or investor is willing to accept.