Required information Use the following information for the Exercises below. (The following information applies to the questions d'splayed below.) 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 155 unitse $8.00 - $1,240 Jan. 10 Sales 115 units $17.00 Jan. 20 Purchase 90 units $7.00 - 630 95 units $17.00 210 unitse $6.50 - 1,365 Totals $3,235 210 units Jan. 25 Sales Jan. 30 Purchase 455 units The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 245 units, where 210 are from the January 30 purchase, 5 are from the January 20 purchase, and 30 are from beginning inventory. Exercise 5-4 Perpetual: Income effects of inventory methods LO A1 mplete expenses are $1,400 and that the applicable income tax rate is 40%. (Round your Intermediate LAKER COMPANY Income Statements For Month Ended January 31 Specific Weighted Identification Average FIFO LIFO 0 0 0 0 5 Sales Cost of goods sold Gross profit Expenses Income before taxes Income tax expense Net income 0 0 0 0 $ 0 $ 0 $ 0 $ 0 2. Which method yields the highest net income? Specific identification Weighted average O FIFO OLIFO 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? Specific identification OLIFO O Weighted average O FIFO