Soumahoro, Ali, & Jay Partners show the following pretax data for its first year of operations.

Net sales		7,560
Cost of goods available for sale		5,900
Operating expenses		1,783
Effective tax rate		12	%
Ending inventories:
If LIFO is elected		684
If FIFO is elected		853

How much more will the company report in income tax if it elects FIFO instead of LIFO?

Multiple Choice

• $105.

• $113.

• $93.

• $20.

Under the gross profit method to calculate ending inventory, it is not necessary to know:

Multiple Choice

• Beginning inventory.

• Net sales.

• Cost of goods sold.

• Net purchases.