2 Laker Company reported the following January purchases and sales data for its only product. Units sold at Retail Units Acquired at Cost 195 units@ $12.00 = $2,340 Part 2 of 2 155 units @ $21.00 Date Activities Beginning Jan. 1 inventory Jan. 10 Sales Jan. 20 Purchase Jan. 25 Sales Jan. 30 Purchase Totals 120 units@ $11.00 - 1,320 135 units @ $ 21.00 1.66 290 units@ $10.50 = 605 units 3,045 $ 6,705 points 290 units 2 01:55:22 The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 315 units, where 290 are from the January 30 purchase, 5 are from the January 20 purchase, and 20 are from beginning inventory. eBook Exercise 5-4 Perpetual: Income effects of inventory methods LO A1 Hint Required: 1. Complete comparative income statements for the month of January for Laker Company for the four inventory methods. Assume expenses are $1,800 and that the applicable income tax rate is 40%. (Round your Intermediate calculations to 2 decimal places.) Print de References LAKER COMPANY Income Statements For Month Ended January 31 Specific Weighted Identification Average FIFO LIFO Sales Cost of goods sold Gross profit Expenses Income before taxes Income tax expense Net income eBook 2. Which method yields the highest net income? 10 Hint OLIFO O Weighted average O FIFO Specific identification Print References 3. Does net income using weighted average fall between that using FIFO and LIFO? O No O Yes 4. If costs were rising instead of falling, which method would yield the highest net income? O FIFO Specific identification OLIFO O Weighted average