The company uses the LIFO method to value its inventory. In addition, the footnotes to the company's annual report revealed that, during 2019 and 2018, inventory usage resulted in liquidations of LIFO inventory quanti- 2019 and 2018, respectively. Calculate the company's net income before tax assuming that the LIFO inven- (in millions) 2019 2018 Net income before tax $400 $40 fory liquidations had not occurred. Discuss why the incremental profit from LIFO-layer liquidation is often referred to as "phantom profit." ROBLEMS : 33 Calculating the value of Ending Inventory and Cost of Goods Sold: Periodic Method. Desmond Con solidated, Inc. is a leading manufacturer of steel products . The following inventory data relates to the firm's production during the first quarter of 2020: Tons of Raw Steel Purchased Purchase Price per Ton Total Cost Date of Purchase 500 700 Jan. 1.. Jan. 15 Feb. 7 Feb. 21 March 15. 200 450 350 $3B 35 33 30 43 $19.000 24,500 6,600 13,500 15,050 $78,650 2,200 At the end of the first quarter of 2020, Desmond's internal auditors determined that 1,700 tons of raw steel had been processed and sold. Required 1. Calculate the cost of steel processed and sold during the quarter under each of the following methods, assuming use of a periodic inventory management system: 4. FIFO b. LIFO c. Weighted-average 2. Assume that the net realizable value per ton is $38.50 at the end of the quarter. What amount should Des- mond's ending inventory be valued at on its March 31 balance sheet under each of the following methods? 4. FIFO b. LIFO c. Weighted average 3. Which method FIFO, LIFO, or the weighted average cost methodshould Desmond use for reporting its financial results to its shareholders? Why? How does this decision constrain the company's method choice for income tax reporting? Calculating the value of Ending Inventory and cost of Goods Sold: Perpetual Method. Consider the following inventory data for the first two months of the year for Huron International