Use the data for Nashville Sales, Inc., in E6-25B to illustrate Nashville Sales€™ income tax advantage from using LIFO over FIFO. Sales revenue is $9,775, operating expenses are $3,800, and the income tax rate is 40%. How much in taxes would Nashville Sales save by using the LIFO method versus FIFO?
In E6-25B, Nashville Sales, Inc.€™s inventory records for a particular development program show the following at August31:

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Aug 1 Beginning inventory Aug 15 Purchasc Aug 26 Purchase. 6 units $170 -$1,020 8 units 172 -1,376 14 units 1802,520 ..