Question: AAA Hardware uses the LIFO method to report its inventory. Inventory at the beginning of the year consisted of 1 0 , 0 0 0

AAA Hardware uses the LIFO method to report its inventory. Inventory at the beginning of the year consisted of 10,000 units of the companys one product. These units cost $15 each. During the year, 60,000 units were purchased at a cost of $18 each, and 64,000 units were sold. Near the end of the fiscal year, management is considering the purchase of an additional 5,000 units at $18.
Required:
What would be the effect of this purchase on income before income taxes?
What would be the effect of this purchase on income before income taxes using FIFO?

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