The statement of income of SAM Ltd, a manufacturing company, for the year ending

December 31, 2015 was as follows:

$000

Revenue 85 000

Cost of sales (48 000)

Gross Profit 37 000

Other operating expenses (8 000)

Profit from operations 29 000

Investment income

Finance cost (9 000)

Profit before tax 20 000

Income tax expense (7 000)

Net profit for the period 13 000

SAM Ltd. has used the LIFO method of inventory valuation but the directors wish to

assess the implications of using the FIFO method. Relevant details of the inventories of

SAM Ltd. are as follows:

DATE Inventory valuation under:

FIFO LIFO

$000 $000

1 JAN 2015 6 500 7 000

31 DEC 2015 8 200 7 300

i. Re-draft the statement of income of SAM Ltd. using the FIFO method of inventory valuation.