Suppose a division of Arkansas Instruments Incorporated that sells computer microchips has these inventory records for January 2021 : 1 (Click the icon to view the inventory records.) The company's accounting records show 420 units were sold for revenue of $10,500. Operating expense for January was $4,200. Read the requirements 2 three decimal places and all other figures to whole-dollar amounts. Show your computations. Begin by preparing the income statement using LIFO, then average, and finally FIFO cost. Requirement 2. Suppose you are the financial vice president of Arkansas Instruments Incorporated. Which inventory method will you use if your motive is to a. minimize income taxes? Use (1) to minimize income taxes. Operating income under this method is lowest when inventory unit costs are (2) , as they are in this case. (If inventory unit costs were going the opposite direction, income under ( 3 would be lowest.) b. report the highest operating income? Use (4) to report the highest operating income. Income under this method is highest when inventory unit costs are (5) as in this situation. c. report operating income between the extremes of FIFO and LIFO? Paper size Use (6) to report an operating income amount between the FIFO and LIFO extremes. This is true in this situation and in others when inventory unit costs are (7) d. report inventory on the balance sheet at the most current cost? Use (8) to report inventory on the balance sheet at the most current cost. The (9) . inventory costs are expensed as cost of goods sold, leaving in ending inventory the (10) - costs of the period. e. attain the best measure of net income for the income statement? Use (11) to attain the best measure of net income. This method produces the best current expense recognition by matching the (12) expense with current revenue. The (13) inventory costs are expensed as cost of goods sold. 1: Data Table 2: Requirements decimal places and all other figures to whole-dollar amounts. Show your computations. 2. Suppose you are the financial vice president of Arkansas Instruments. Which inventory method will you use if your motive is to a. minimize income taxes? b. report the highest operating income? c. report operating income between the extremes of FIFO and LIFO? d. report inventory on the balance sheet at the most current cost? e. attain the best measure of net income for the income statement? State the reason for each of your answers. e. attain the best measure of net income for the income statement? Paper size Use (11) to attain the best measure of net income. This method produces the best current expense recognition by matching the (12) expense with current revenue. The (13) inventory costs are expensed as cost of goods sold. 1: Data Table 2: Requirements decimal places and all other figures to whole-dollar amounts. Show your computations. 2. Suppose you are the financial vice president of Arkansas Instruments. Which inventory method will you use if your motive is to a. minimize income taxes? b. report the highest operating income? c. report operating income between the extremes of FIFO and LIFO? d. report inventory on the balance sheet at the most current cost? e. attain the best measure of net income for the income statement? State the reason for each of your answers. (1) FIFO (2) decreasing (3) FIFO (4) FIFO (5) decreasing (6) FIFO LIFO LIFO LIFO the average-cost method the average-cost method the average-cost method the average-cost method (7) increasing (8) FIFO (9) most current (10) most current (11) FIFO (12) most current (13) most current decreasing LIFO oldest increasing or decreasing the average-cost method the average-cost method Requirements 1. Prepare the company's January, multistep income statement. Calculate income using the LIFO, average-cost, and FIFO methods. Label the bottom line "Operating income." Round the average cost per unit to three decimal places and all other figures to whole-dollar amounts. Show your computations. 2. Suppose you are the financial vice president of Arkansas Instruments. Which inventory method will you use if your motive is to a. minimize income taxes? b. report the highest operating income? c. report operating income between the extremes of FIFO and LIFO? d. report inventory on the balance sheet at the most current cost? e. attain the best measure of net income for the income statement? State the reason for each of your answers. Suppose a division of Arkansas Instruments Incorporated that sells computer microchips has these inventory records for January 2021 : 1 (Click the icon to view the inventory records.) The company's accounting records show 420 units were sold for revenue of $10,500. Operating expense for January was $4,200. Read the requirements 2 three decimal places and all other figures to whole-dollar amounts. Show your computations. Begin by preparing the income statement using LIFO, then average, and finally FIFO cost. Requirement 2. Suppose you are the financial vice president of Arkansas Instruments Incorporated. Which inventory method will you use if your motive is to a. minimize income taxes? Use (1) to minimize income taxes. Operating income under this method is lowest when inventory unit costs are (2) , as they are in this case. (If inventory unit costs were going the opposite direction, income under ( 3 would be lowest.) b. report the highest operating income? Use (4) to report the highest operating income. Income under this method is highest when inventory unit costs are (5) as in this situation. c. report operating income between the extremes of FIFO and LIFO? Paper size Use (6) to report an operating income amount between the FIFO and LIFO extremes. This is true in this situation and in others when inventory unit costs are (7) d. report inventory on the balance sheet at the most current cost? Use (8) to report inventory on the balance sheet at the most current cost. The (9) . inventory costs are expensed as cost of goods sold, leaving in ending inventory the (10) - costs of the period. e. attain the best measure of net income for the income statement? Use (11) to attain the best measure of net income. This method produces the best current expense recognition by matching the (12) expense with current revenue. The (13) inventory costs are expensed as cost of goods sold. 1: Data Table 2: Requirements decimal places and all other figures to whole-dollar amounts. Show your computations. 2. Suppose you are the financial vice president of Arkansas Instruments. Which inventory method will you use if your motive is to a. minimize income taxes? b. report the highest operating income? c. report operating income between the extremes of FIFO and LIFO? d. report inventory on the balance sheet at the most current cost? e. attain the best measure of net income for the income statement? State the reason for each of your answers. e. attain the best measure of net income for the income statement? Paper size Use (11) to attain the best measure of net income. This method produces the best current expense recognition by matching the (12) expense with current revenue. The (13) inventory costs are expensed as cost of goods sold. 1: Data Table 2: Requirements decimal places and all other figures to whole-dollar amounts. Show your computations. 2. Suppose you are the financial vice president of Arkansas Instruments. Which inventory method will you use if your motive is to a. minimize income taxes? b. report the highest operating income? c. report operating income between the extremes of FIFO and LIFO? d. report inventory on the balance sheet at the most current cost? e. attain the best measure of net income for the income statement? State the reason for each of your answers. (1) FIFO (2) decreasing (3) FIFO (4) FIFO (5) decreasing (6) FIFO LIFO LIFO LIFO the average-cost method the average-cost method the average-cost method the average-cost method (7) increasing (8) FIFO (9) most current (10) most current (11) FIFO (12) most current (13) most current decreasing LIFO oldest increasing or decreasing the average-cost method the average-cost method Requirements 1. Prepare the company's January, multistep income statement. Calculate income using the LIFO, average-cost, and FIFO methods. Label the bottom line "Operating income." Round the average cost per unit to three decimal places and all other figures to whole-dollar amounts. Show your computations. 2. Suppose you are the financial vice president of Arkansas Instruments. Which inventory method will you use if your motive is to a. minimize income taxes? b. report the highest operating income? c. report operating income between the extremes of FIFO and LIFO? d. report inventory on the balance sheet at the most current cost? e. attain the best measure of net income for the income statement? State the reason for each of your answers