First Question

Second Question part B

Please show work, calculations, and explanation for part B on question 2

Sheffield Company uses the LCNRV method, on an individual-item basis, in pricing its inventory items. The inventory at December 31 . 2025 , included product X, Relevant per-unit data for product X are as follows. There were 1,050 units of product X on hand at December 31,2025 . Product X was incorrectly valued at $39 per unit for reporting purposes. All 1,050 units were sold in 2026. Compute the effect of this error on net income for 2025 and the effect on net income for 2026 , and indicate the direction of the misstatement for each year. Net income for 2025$ Net income for 2026$ Compute the ending inventory, assuming that (a) gross profit is 45% of sales, (b) gross profit is 60% of cost, (c) gross profit is 37% of sales, and (d) gross profit is 25% of cost. (Round ratios for computational purposes to 1 decimal ploce, es. 78.7% and final answers to 0 decimal places, e.g. 28,987.)