### What would be the effect of this purchase on income

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Question - AA Hardware uses the LIFO method to value its inventory. Inventory at the beginning of the year consisted of 28,000 units of the company's one product. These units cost \$14 each. During the year, 78,000 units were purchased at a cost of \$17 each and 83,000 units were sold. Near the end of the fiscal year, management is considering the purchase of an additional 11,500 units at \$17.

What would be the effect of this purchase on income before income taxes?

What would be the effect of this purchase on income before income taxes using FIFO method?

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