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

Date			Activities	Units Acquired at Cost								Units sold at Retail
Jan.	1		Beginning inventory	235	units	@	$	16.00	=	$	3,760
Jan.	10		Sales										185	units	@	$	25.00
Jan.	20		Purchase	180	units	@	$	15.00	=		2,700
Jan.	25		Sales										200	units	@	$	25.00
Jan.	30		Purchase	370	units	@	$	14.50	=		5,365
			Totals	785	units					$	11,825		385	units

The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 400 units, where 370 are from the January 30 purchase, 5 are from the January 20 purchase, and 25 are from beginning inventory.

Required: 1. Complete comparative income statements for the month of January for Laker Company for the four inventory methods. Assume expenses are $2,200, and that the applicable income tax rate is 40%. (Round your Intermediate calculations to 2 decimal places.)

2. Which method yields the highest net income?

LIFO

Weighted average

Specific identification

FIFO

3. Does net income using weighted average fall between that using FIFO and LIFO?

Yes

No

4. If costs were rising instead of falling, which method would yield the highest net income?

LIFO

Specific identification

Weighted average

FIFO