Mondetta Clothing prepared its annual financial statements dated December 31. The com method, but it failed to evaluate the net realizable value of its ending inventory. The prelin $402,000 $ 40,500 264,000 304,500 38,640 Net Sales Cost of Goods Sold Beginning Inventory Purchases Goods Available for Sale Ending Inventory Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Income Tax Expense (40%) Net Income 265, 860 136,140 88,500 47,640 19,056 $ 28,584 Assume that you have been asked to restate the financial statements to incorporate LCM relating to the ending inventory: Acquisition Cost Item B D Per Quantity Unit 2,100 $3.60 1,050 4.20 6,100 2.10 2,100 6.60 Total $ 7,560 4,410 12,810 13,860 $38,640 Net Realizable Value per Unit $5.10 2.10 5.10 3.60 Required: 1. Restate the income statement to reflect LCM/NRV valuation of the ending inventory. Appl 2. Compare the LCM/NRV effect on each amount that was changed in the preliminary incom Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compare the LCM/NRV effect on each amount that was changed in the preliminary income state (Decreases should be indicated by a minus sign.) Item Changed FIFO Cost LCM/NRV Basis Basis Amount of Increase (Decrease) $ 38,640 Ending Inventory Cost of Goods Sold Gross Profit Income from Operations Income Tax Expense $ 265,860 $ 136,140 $ 47,640 $ 19,056 $ 28,584 + Net Income