Keefer, Inc. began business on January 1, 2007. Information on its inventory purchases and sales during 2007 and 2008 follow:

Required:
1. Calculate ending inventory, cost of goods sold, and gross margin for 2007 and 2008 under the periodic FIFO inventory valuation method.
2. Calculate ending inventory, cost of goods sold, and gross margin for 2007 and 2008 under the periodic LIFO inventory valuation method.
3. Discuss the difference in reported results under FIFO versus LIFO for each year.

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Inventory Purchases Cost per Unit Total Date Units January 1, 2007 85 $25 $ 2,125 March 15, 2007 100 27 2,700 May 15, 2007 90 28 2,520 August 1, 2007 100 30 3,000 September 3, 2007 125 31 3,875 December 5, 2007 50 32 1,600 Total purchases-2007 550 $15,820 February 20, 2008 150 $31 $ 4,650 March 29, 2008 100 30 3,000 July 1, 2008 100 29 2,900 August 20, 2008 100 28 2,800 November 3, 2008 80 27 2,160 Total purchases-2008 530 $15,510 Inventory Sales Units Price per Unit Total March 18, 2007 65 $50 $ 3,250 August 15, 2007 200 52 October 6, 2007 175 53 Total sales-2007 440 February 12, 2008 100 $53 June 2, 2008 200 52 September 30, 2008 210 50 Total sales-2008 510 10,400 9,275 $22,925 $ 5,300 10,400 10,500 $26,200