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P$7-4($Algo$)$ Analyzing and Interpreting Income Manipulation Under the LIFO Inventory Method LO$7-2,7.$

$3$

$[$The following information applies to the questions displayed below.$]$

Pacific Company sells electronic test equipment that it acquires from a foreign source. During the year, the inventory

records reflected the following:

Inventory is valued at cost using the LIFO inventory method.

P$7-4$ Part $3$

How much did pretax income change because of the decision on December $31,$ current year?

$3$b$.$ Assuming that the unit cost of test equipment is expected to continue to decline during the following year, is there any evidence of

income manipulation?

Complete this question by entering your answers in the tabs below.

How much did pretax income change because of the decision on December $31,$ current year?