Answer:
<u>Comparative condensed income statements for 2022</u>
LIFO FIFO
Sales 765,000 765,000
Less Cost of Sales (345,400) (327,400)
Gross Profit 419,600 437,600
Less Expenses:
Operating expenses 121,000 121,000
Operating Income before tax 298,600 316,600
Less Income tax (28,608) (88,648)
Operating Income after tax 269,992 227,952
Explanation:
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<em>Calculation of Cost of Sales - LIFO</em>
Cost of Sales : 28,000 units×$3.70 = 103,600
57,000 units×$3.40 = 193,800
15,000 units×$3.20 = 48,000
Total =345,400
<em>Calculation of Cost of Sales - FIFO</em>
Cost of Sales : 10,000 units×$3.00 = 30,000
38,000 units×$3.20 = 121,600
52,000 units×$3.40 = 175,800
Total = 327,400
