Reference no: EM132564405

The Hasting Company began operations on January 1, 2003 and uses the FIFO method in costing its raw material inventory. An analyst is wondering what net income would have been if the company had consistently followed LIFO (instead of FIFO) from the beginning, 1/1/2003. He has the following information available to him:

                                              12/31/2003                                   12/31/2004

                                            Final Inventory                               Final Inventory

Under FIFO                        $240,000                              Under FIFO $270,000

Under LIFO                           $200,000                           Under LIFO $210,000

For2003 and 2004

Pretax Income under FIFO $120,000 and $170,000

Question 1: What would net income have been in 2004 if Hastings had used LIFO since 1/1/2003?