The management of Gresa Inc. requests your help in determining the results of operations for 2017 if either the FIFO or the LIFO method has been used. The company is reevaluating the appropriateness of using its present inventory cost flow method, which is average-cost. For 2017, the accounting records show these data:

Inventories Purchases and Sales
Beginning (10,000 units) $ 20,000 Total net sales (239,000 units) $ 1,087,450
Ending (21,000 units) Total cost of goods purchased (250,000 units) 596,500
Purchases were made quarterly as follows.

Quarter Units Unit Cost Total Cost
1 65,000 $ 2.20 $ 143,000
2 55,000 2.30 126,500
3 55,000 2.40 132,000
4 75,000 2.60 195,000
250,000 $ 596,500
Operating expenses were $100,000, and the company's income tax rate is 40%.

Prepare comparative condensed income statements for 2017 under FIFO and LIFO.

GRESA INC.
Condensed Income Statements
For the Year Ended December 31, 2017
FIFO LIFO
Sales Revenue $ 1,087,450 $ 1,087,450
Cost of Goods Sold
Beginning Inventory 20,000 20,000
Cost of Goods Purchased 596,500 596,500
Cost of Goods Available for Sale
Ending Inventory
Cost of Goods Sold
Gross Profit / (Loss)
Operating Expenses
Income before Income Taxes
Income Tax Expense
Net Income / (Loss)

Georgia orchards produced a good crop of peaches this year. after preparing the following income statement, the company is concerned about the net loss on its no. 3 peaches. georgia orchards income statement for year ended december 31, 2017 no. 1 no. 2 no. 3 combined sales (by grade) no. 1: 300,000 ibs. @ $1.50/lb $ 450,000 no. 2: 300,000 ibs. @ $1.00/lb $ 300,000 no. 3: 750,000 ibs. @ $0.25/lb $ 187,500 total sales $ 937,500 costs tree pruning and care @ $0.30/ib 90,000 90,000 225,000 405,000 picking, sorting, and grading @ $0.15/ib 45,000 45,000 112,500 202,500 delivery costs 15,000 15,000 37,500 67,500 total costs 150,000 150,000 375,000 675,000 net income (loss) $ 300,000 $ 150,000 $ (187,500 ) $ 262,500 in preparing this statement, the company allocated joint costs among the grades on a physical basis as an equal amount per pound. the company’s delivery cost records show that $30,000 of the $67,500 relates to crating the no. 1 and no. 2 peaches and hauling them to the buyer. the remaining $37,500 of delivery costs is for crating the no. 3 peaches and hauling them to the cannery. required: 1. prepare reports showing cost allocations on a sales value basis to the three grades of peaches. separate the delivery costs into the amounts directly identifiable with each grade. then allocate any shared delivery costs on the basis of the relative sales value of each grade. (do not round intermediate calculations.)