Financial Statement Analysis Case 1 a, b, c (Part Level Submission) T) International was founded in 1969 as Trus Jotst International. The firm, a manufacturer of specialty building products, has its headquarters in Boise, Idaho. The company through its partnership in the Trus Joist MacMillan joint venture, develops and manufactures engineered lumber. This product is a high-quality substitute for structural lumber and uses lower-grade wood and materials formerly considered waste. The company also is majority owner of the Outlook Window Partnership, which is a consortium of three wood and vinyl window manufacturers. Following is T ) International's adapted income statement and information concerning inventones from its annual report. Sales $618,876,000 Cost of goods sold 475 476,000 Gross profit 143,400,000 Selling and administrative expenses 102,112,000 Income from operations 41,288,000 Other expense 24.712 000 Income before income tax 16,576,000 Income taxes 7,728,000 Net income 8,848,000 Inventories. Inventories are valued at the lower of cost or market and include material, labor, and production overhead costs. Inventories consisted of the following: Current Year Prior Year Finished goods $27,512,000 $23,830,000 Raw materials and work-in-progress 34,363,000 33 244.000 61,875,000 $7,074,000 Reduction to UFO cost (5.263.000) (3.993.000). $56,612,000 $53,081,000 The last-in, first-out (LIFO) method is used for determining the cost of lumber, veneer, Microllam lumber TI joists, and open web joists. Approrimately 35 percent of total inventories at the end of the current year were valued using the LIFO method. The first- in, first-out (FFO) method is used to determine the cost of all other inventories. (a) How much would income before taxes have been if FIFO costing had been used to value all inventories? Income before income tax