Use the following information for the Exercises below The fo

Use the following information for the Exercises below.

[The following information applies to the questions displayed below.]

Laker Company reported the following January purchases and sales data for its only product.

The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 200 units, where 180 are from the January 30 purchase, 5 are from the January 20 purchase, and 15 are from beginning inventory.

Exercise 5-4 Perpetual: Income effects of inventory methods LO A1

Required:

1. Complete comparative income statements for the month of January for Laker Company for the four inventory methods. Assume expenses are $1,250, and that the applicable income tax rate is 40%. (Round your Intermediate calculations to 2 decimal places.)

Date	Activities	Units Acquired at Cost	Units sold at Retail
Jan.	1	Beginning inventory	140	units	@	$	6.00	=	$	840
Jan.	10	Sales										100	units	@	$	15
Jan.	20	Purchase	60	units	@	$	5.00	=		300
Jan.	25	Sales										80	units	@	$	15
Jan.	30	Purchase	180	units	@	$	4.50	=		810
		Totals	380	units					$	1,950		180	units

Solution

STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL FIFO METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ 1-Jan 140 6 840 10-Jan 100 6 600 40 6 240 20-Jan 60 5 300 40 6 240 60 5 300 25-Jan 40 6 240 40 5 200 20 5 100 30-Jan 180 4.5 810 20 5 100 180 4.5 810 TOTAL 240 1110 180 1040 200 910 STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL LIFO METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ 1-Jan 140 6 840 10-Jan 100 6 600 40 6 240 20-Jan 60 5 300 40 6 240 60 5 300 25-Jan 60 5 300 20 6 120 20 6 120 30-Jan 180 4.5 810 20 6 120 180 4.5 810 TOTAL 240 1110 180 1020 200 930 STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL WEIGHTED AVERAGE METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ 1-Jan 140 6 840 10-Jan 100 6 600 40 6 240 20-Jan 60 5 300 40 6 240 60 5 300 Average 100 5.4 540 25-Jan 80 5.4 432 20 5.4 108 30-Jan 180 4.5 810 20 5.4 108 180 4.5 810 Average 200 4.59 918 TOTAL 240 1110 180 1032 200 4.59 918 STATEMENT SHOWING INVENTORY RECORD UNDER PERIODIC SPECIFIC IDENTIFICATION METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ 1-Jan 140 6 840 125 6 750 15 6 90 Purchasse 20-Jan 60 5 300 55 5 275 5 5 25 30-Jan 180 45 810 180 4.5 810 TOTAL 380 1950 180 1025 200 925 FIFO LIFO Average Specific Sales revenue 2700 2700 2700 2700 (180 units @15) Less: COGS 1040 1020 1032 1025 Gross margin 1660 1680 1668 1675 Less: Operating expense 1250 1250 1250 1250 Net income before tax 410 430 438 425 Less: Tax 164 172 175.2 170 Income after tax 246 258 262.8 255