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:

Restate the income statement to reflect LCM$/$NRV valuation of the ending inventory. Apply LCM$/$NRV on an item$-$by$-$item basis.

Compare the LCM$/$NRV effect on each 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 $2$

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 Cost Basis LCM$/$NRV Basis Amount of Increase $($Decrease$)$

Ending Inventory

Cost of Goods Sold

Gross Profit

Income from Operations

Income Tax Expense

Net Income

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 Cost Basis LCM$/$NRV Basis Amount of Increase $($Decrease$)$

Ending Inventory

Cost of Goods Sold

Gross Profit

Income from Operations

Income Tax Expense

Net Income