P6-72B. (Learning Objectives 2, 3: Applying the different inventory costing methods—

perpetual system) The records of Bryan Aviation include the following accounts for inventory of aviation fuel at December 31 of the current year:

Requirements 1. Prepare a partial Income Statement through gross profit under the average, FIFO, and LIFO methods. Round average cost per unit to four decimal places and all other amounts to the nearest whole dollar.
2. Which inventory method would you use to minimize income tax? Explain why this method causes income tax to be the lowest.

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Inventory Jan 1 Mar 6 Jun 22 Oct 4 Balance Purchase 320 units @ 7.80 Purchase 8,380 units @ 8.10 740 units @ 7.50 5,550 2,496 67,878 Purchase 530 units @ 9.10 4,823 Sales Revenue Dec 31 9,030 units 128,226