The president of Aggressive Ltd. has come to you for advice. Aggressive is a newly established company with prospects for high growth. Decisions must soon be made concerning accounting policies for external financial reporting. The following information pertains to the companys first year of operations (in thousands of dollars):

Revenue	$	78,000
Purchases		29,250
Closing inventoryFIFO		9,750
Closing inventoryaverage cost		7,800
Depreciationstraight line		2,900
Depreciationdeclining balance		5,800
Development expense		2,900
Amortization of development over five years		580
Other expenses		6,750
Income tax rate		20	%

Required: 1. Prepare a columnar income statement. In column 1, show net income assuming the use of FIFO, declining-balance depreciation, and expensing of development. In successive columns, show the individual impact of each of the following policy changes on net income:

a. In column 2, average cost b. In column 3, straight-line depreciation c. In column 4, amortization of development and d. In column 5, the combined effects of the alternatives presented separately in columns 2 through 4.

(Negative amounts should be indicated by minus sign.)

2. Not available in connect.