Springer Anderson Gymnastics prepared its annual financial statements dated December 31. The company used the FIFO inventory costing method, but it failed to apply LCM to the ending inventory. The preliminary income statement follows: Sales Revenue Cost of Goods Sold S152,000 Beginning Inventory S 18,000 97,000 Goods Available for Sale Ending Inventory (FIFO cost) 115,000 30,420 Cost of Goods Sold 84,580 Gross Profit Operating Expenses 67,420 34,000 Income from Operations 33,420 10,026 Income Tax Expense (30%) Net Income S 23,394 Assume that you have been asked to restate the financial statements to incorporate LCM. You have developed the following data relating to the ending inventory Market Value Purchase Cost tem Quantity Per Unit Total per Unit 1,800 S3.60 4.00 2.60 5.60 S 6,480 3,200 10,660 10,080 54.80 4,100 1,800 2.60 1.30 3.60 $30,420 Required: 1. Restate the income statement to reflect LCM valuation of the ending inventory. Apply LCM on an item- by-item basis. SPRINGER ANDERSON GYMNASTICS Income Statement (LCM basis) For the Year Ended December 31 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 Net Income