Question: AAA Hardware uses the LIFO method to value its inventory. Inventory at the beginning of the year consisted of 19,000 units of the companys one

AAA Hardware uses the LIFO method to value its inventory. Inventory at the beginning of the year consisted of 19,000 units of the companys one product. These units cost $15 each. During the year, 69,000 units were purchased at a cost of $18 each and 71,000 units were sold. Near the end of the fiscal year, management is considering the purchase of an additional 9,500 units at $18. Required:

1. What would be the effect of this purchase on income before income taxes?

AAA Hardware uses the LIFO method to value its inventory. Inventory at

2. What would be the effect of this purchase on income before income taxes using FIFO method?

the beginning of the year consisted of 19,000 units of the companys

Income before income taxes would be

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