REFERENCE: Ref.08_14 Harrison Company,Inc.began Operations on January 1,2008,and Applied the LIFO Method

question 80

Essay

REFERENCE: Ref.08_14
Harrison Company,Inc.began operations on January 1,2008,and applied the LIFO method for inventory valuation.On June 10,2009,Harrison adopted the FIFO method of accounting for inventory.Additional information is as follows:
The LIFO method was applied during the first quarter of 2009 and the FIFO method was applied during the second quarter of 2009 in computing income,above.Harrison's effective income tax rate is 40 percent.Harrison has 500,000 shares of common stock outstanding at all times.
-Prepare a schedule showing the calculation of net income and earnings per share to be reported by Harrison for the three-month period and the six-month period ended June 30,2008 and 2009.

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Definitions:

Special Discounted Price

This is a temporary reduction in the selling price of goods or services, often used to attract customers or promote sales.

Segment Margin

The amount of profit or loss generated by one part of a business, after accounting for the direct and indirect costs of that segment.

Financial Advantage

The benefit gained in financial terms, which could be through savings, profits, or reduced costs.

Outside Supplier

An outside supplier is an external entity that provides goods or services to a company, not tied by corporate affiliation.