Problem - The board of directors of Oksana Corporation is considering whether or not it should instruct the accounting department to change from a first-in, first out (FIFO) basis of pricing inventories to a last in, first out (LIFO) basis. The following information is available.
Sales 20,000 units at $50.00
Inventory, January first 6,000 units at $20.00
Purchases 6,000 at $22.00
Purchases 10,000 at $25.00
Purchases 7,000 at $30.00
Inventory, December 31st, 9,000 units at $?.??
Operating expenses $200,000
Prepare a condensed income statement for the ear on both bases for comparative purposes.