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The following information can be found in ABC Co.'s financial statements:
2006 2005
Finished Goods $503,380 $390,720
Work -in-Process 490,246 372,864
Raw Materials 273,136 213,578
Total FIFO Value 1,266,762 977,162
Less LIFO reserve 125,902 142,372
Inventories 1,140,860 834,790
Retained earnings 7,052,000 6,318,000
Assume a tax rate of 35%.
Inventories valued using the LIFO method represented approximately 80% of consolidated inventories.
What will be the retained earnings for 2006 if ABC used FIFO valuation?
| | | $6,410,542 |
| | | $7,786,000 |
| | | $7,133,836 |
| | | $8,192,860 |
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