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:

Assume that you have been asked to restate the financial statements to incorporate the LCM/NRV rule. You have developed the following data relating to the ending inventory:

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 each amount that was changed in the preliminary income statement in requirement 1I need help with income tax expense and net icome

Sales Revenue Cost of Goods Sold $122,000 Beginning Inventory $10,500 82,000 Purchases Goods Available for Sale 92,500 20, 500 Ending Inventory Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Income Tax Expense (30%) Net Income 72,000 50,000 26,500 23,500 7,050 $ 16,450 Purchase Cost Total $ 5,145 2,450 2,860 10,045 $20,500 Replacement Cost per Unit $3.10 1.10 0.55 2.10 Per Unit $2.10 Item Quantity 2,450 700 2,600 2,450 3.50 1.10 4.10 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 (LCMNRV basis) For the Year Ended December 31 Sales Revenue $ 122,000 Cost of Goods Sold $ 10,500 82,000 92,500 12,490 Beginning Inventory Purchases Goods Available for Sale Ending Inventory 80,010 41,990 26,500 15,490 4,935 $ 10,555 Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Income Tax Expense Net Income