Required information P7-4 (Algo) Analyzing and Interpreting Income Manipulation Under the LIFO Inventory Method LO7-2, 7-3 [The following information applies to the questions displayed below.] Pacific Company sells electronic test equipment that it acquires from a foreign source. During the year, the inventory records reflected the following: Beginning inventory Purchases Sales (50 units at $24,690 each) Units 23 40 Unit Cost $11,630 10,130 Total Cost $ 267,490 405,200 Inventory is valued at cost using the LIFO inventory method. P7-4 Part 1 Required: 1. Complete the following income statement summary using the LIFO method and the periodic inventory system. PACIFIC COMPANY Income Statement For the Current Year Ended Sales revenue Cost of goods sold Gross profit Expenses 293,000 Pretax income Ending inventory P7-4 Part 2 2. The management, for various reasons, is considering buying 23 additional units before December 31 year-end at $9,630 each. Restate the income statement (and ending inventory), assuming that this purchase is made on December 31. Assume the LIFO method and the periodic inventory system are used by the company. PACIFIC COMPANY Income Statement For the Current Year Ended Sales revenue Cost of goods sold Gross profit Expenses 293,000 Pretax income Ending inventory P7-4 Part 3 3a. How much did pretax income change because of the decision on December 31, current year? 3b. Assuming that the unit cost of test equipment is expected to continue to decline during the following year, is there any evidence of income manipulation? Complete this question by entering your answers in the tabs below. Reg ?? Reg 3B How much did pretax income change because of the decision on December 31, current year? Pretax income by Req ?? Req 3B Assuming that the unit cost of test equipment is expected to continue to decline during the following year, is there any evidence of income manipulation? Is there any evidence of income manipulation?