Springer Anderson Gymnastics prepared its annual financial statements dated December 31. The company reported its inventory using the LIFO inventory costing method but did not compare the cost of its ending inventory to its market value (replacement cost). The preliminary income statement follows: $ 128,820 $12.00 85,00 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 (36) Net Income 97,000 21,880 75,280 52,880 28. oee 24,880 7.440 $ 17, 360 Assume that you have been asked to restate the financial statements to incorporate the LCM/NRV rule. You have developed the following date relating to the ending inventory: Item A B Quantity 2.3ee 780 2.980 2.38 Purchase Cost Per Unit Total $2.40 $ 5,520 3.80 2.100 1.48 4,86e 4.40 10,120 $21, see Replacement Cost per Unit $3.40 1.40 8.70 2.40 D Required: 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 the LCM/NRV effect on esch amount that was changed in the preliminary income statement 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. SPRINGER ANDERSON GYMNASTICS Income statement (LCMINRV bable) For the Year Ended December 31 Sales Revenue Cast 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 Net Income Required Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compare the LCM/NRV effect on each amount that was changed in the preliminary income statement in requirement 1. (Decreases should be indicated by a minus sign.) Item Changed LIFO Coat LCMINRV Basle Basle Amount of Increase (Decrease) Ending Inventory Cast of Goods Sold Gross Profit Income from Operations Income Tax Expense Net Income