The Accountant at Reber Company Has Determined That Income Before

Multiple Choice

The accountant at Reber Company has determined that income before income taxes amounted to $6,750 using the FIFO costing assumption. If the income tax rate is 30% and the amount of income taxes paid would be $315 greater if the average-cost assumption were used, what would be the amount of income before taxes under the average-cost assumption?

A) $7,065
B) $7,800
C) $6,015
D) $6,435