Smart Company prepared its annual financial statements dated December 31. The company reported its inventory using...

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		Purchase Cost		Net Realizable Value
Item	Quantity	Per unit	Total	Per Unit	Total	LCM/NRV

A	3,000	$ 5	$ 15,000	$ 6	$ 18,000	$ 15,000
B	2,000	$ 8	$ 16,000	$ 6	$ 12,000	$ 12,000
C	8,100	$ 4	$ 32,400	$ 6	$ 48,600	$ 32,400
D	3,200	$ 10	$ 32,000	$ 7	$ 22,400	$ 22,400

			$ 95,400		$ 1,01,000	$ 81,800

Sales Revenue			$ 3,02,000
Less: Cost of goods sold
Beginning Inventory		$ 41,000
Add: Purchase		$ 2,04,000
Cost of goods available for sale		$ 2,45,000
Less: Ending Inventory		$ -81,800
Cost of goods sold			$ -1,63,200
Gross Margin			$ 1,38,800
Less: Operating Expense			$ -72,000
Income from operation			$ 66,800
Less: Income tax (30%)			$ -20,040
Net Income			$ 46,760

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