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Determine whether each of the following actions in buying, selling, n (Click the icon to view the actions.) ounting for inventories is ethical or unethical Give your reason for each answer lizable-value rule to inventories, Terre Haute Industries recorded an excessively low net realizable value for its ending inventory. This allowed the company to pay less income tax for the year 1. In applying the I This action is 2. Laminated Photo Film purchased lots of inventory shortly before year-end to increase the weighted-average cost af goads sold and decrease reported income for the year This action is 3. Madison Inc. delayed the purchase of inventory until after December 31, 2017, to keep 2017s cost of goods sold from growing too large. The delay in purchasing inventory helped net income in 2017 to reach the level of profit demanded by the companys investors. This action is 4. Dover Sales Company deliberately overstated ending inventory in order to report higher profits (net income). This action is 5. Roberto Corporation deliberately overstated purchases to produce a high figure for cost of goods scld (low amount of net income). The real reason was to decrease the company's income tax payments to the government. This action is because because More Info 1. In applying the lower-of-cost-and-net-realizable-value rule to inventories, Terre Haute Industries recorded an excessively low net reaizable value for its ending inventory. This allawed the company to pay less income tax for the year Laminated Photo Film purchased lots of inventory shortly before year end to increase the weighted-average cost of goods sold and decrease reported income for the year. Madison Inc. delayed the purchase of inventory until after December 31. 2017, to keep 2017's cost of goods sold from growing too large. The delay in purchasing inventory helped net income in 2017 to reach the level of profit demanded by the company's investors 2. 3. 4. Dover Sales Company deliberately overslated ending inventory in order to report higher profits (net income 5. Roberto Corporation deliberately overstated purchases to produce a high figure for cost of goods sold (low amount of net income). The real reason was to decrease the company's income tax payments to the

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