The following comparative information is available for Rose Company for 2022. 

Instructions 

a. Determine net income under each approach. Assume a 30% tax rate. 

b. Determine net cash provided by operating activities under each approach. Assume that all sales were on a cash basis and that income taxes and operating expenses, other than depreciation, were on a cash basis. 

c. Calculate the quality of earnings ratio under each approach and explain your findings.

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LIFO FIFO Sales revenue Cost of goods sold Operating expenses (including depreciation) $86,000 $86,000 29,000 27,000 10,000 32,000 27,000 Depreciation 10,000 Cash paid for inventory purchases