! Required information 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. Date Units sold at Retail Units Acquired at Cost 170 units@ $9.50 = $1,615 130 units @ $18.50 Activities Jan. 1 Beginning inventory Jan. 10 Sales Jan. 20 Purchase Jan. 25 Sales Jan. 30 Purchase Totals 120 units@ $8.50 = 1,020 130 units @ $18.50 240 units@ $8.00 = 530 units 1,920 $4,555 260 units The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 270 units, where 240 are from the January 30 purchase, 5 are from the January 20 purchase, and 25 are from beginning inventory. Exercise 5-4 Perpetua 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 $1,550 and that the applicable income tax rate is 40%. (Round your Intermediate calculations to 2 decimal places.) 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 2. Which method yields the highest net income? O Specific identification O FIFO O Weighted average OLIFO 3. Does net income using weighted average fall between that using FIFO and LIFO? O Yes 4. If costs were rising instead of falling, which method would yield the highest net income? O Specific identification O LIFO O FIFO Weighted average