The Berg Company began operations on January 1, 2010 and uses the FIFO method in costing its raw material inventory. During 2011, management is contemplating a change to the LIFO method and is interested in determining what effect such a change will have on net income.

Accordingly, the following information has been developed:

Required
What is the effect on income before income taxes in 2011 of a change to the LIFOmethod?

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FIFO-Ending inventory LIFO-Ending inventory Income before income taxes (computed under the FIFO method) 2010 $240,000 200,000 120,000 2011 $270,000 210,000 170,000