Following is partial information for the income statement of Timber Company under two different inventory costing methods, assuming the use of a periodic inventory system:

Required:
1. Compute the cost of sales under the FIFO and weighted-average inventory costing methods.
2. Prepare an income statement through pretax profit for each method.
3. Rank the two methods with regard to favourable cash flow and explain the basis for your ranking.

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Unit sales price, S50 FIFO Weighted Average Cost of sales Beginning Inventory (330 units) $11,220 $11.220 Purchases (475 units) 17.100 17,100 Cost of goods available for sale Ending inventory (510 units) Cost of sales Operating expenses, $1,600