Requitu. 1. Restate the income statement to reflect LCM/NRV valuation of the ending inventory. Apply LCM/NRV on an item-by-item basis. 2. Compare and explain the LCM/NRV effect on each amount in the income statement that was changed in requirement 1. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Restate the income statement to reflect LCM/NRV valuation of the ending inventory. Apply LCM/NRV on an item-by.Item basis 314,000 SMART COMPANY Income Statement (LCMNRV basis) For the Year Ended December 31 Sales Revenue S Cost of Goods Sold Beginning Inventory $ 47,000 Purchases 216.000 Goods Available for Sale 263.000 Ending Inventory Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Income Tax Expense Net Income Smart Company prepared its annual financial statements dated December 31. The company reported its inventory using the FIFO Inventory costing method and failed to evaluate its net realizable value at December 31. The preliminary income statement follows $314,000 $ 47,000 216,000 263,800 175,600 Sales Revenue 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 (30%) Net Income 87,480 226,600 78,000 148,600 44.580 $104,62e Assume you have been asked to restate the financial statements to incorporate LCM/NRV. You have developed the following data relating to the ending inventory: Item Net Realizable Value per Unit $12 Purchase Cost Quantity Per Unit Total 3,600 $11 $ 39,600 2,000 16,000 8.700 87,000 3,300 33,000 $175,600 10 10