Question - Kimball International Inc. uses the LIFO method of accounting for inventory. In its 2012 inventory footnote Kimball reported a LIFO reserve of $19,500 and $21,100 at June 30, 2012 and 2011, respectively.
Selected data from the financial statements is below
|
2012
|
2011
|
|
Total inventory
|
$89,489
|
$76,146
|
|
Net Sales
|
923,636
|
895,912
|
|
Cost of Sales
|
664,311
|
645,591
|
|
Gross Profit
|
259,325
|
250,321
|
|
Earnings per Share
|
$2.15
|
$1.96
|
a. Compute the inventory amount at June 30, 2012 for Kimball International Inc. assuming that it had used the FIFO method of accounting for inventory.
b. Does Kimball's use of LIFO rather than FIFO affect its cash flows? Explain briefly.