1. Determine the cost of the inventory on December 31 by the first-in, first-out method. first. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method. 3. Determine the cost of the inventory on December 31 by the weighted average cost method. 4a. Which inventory method would be preforred for income tax purposes in periods of rising prices? 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. first. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method. 3. Determine the cost of the inventory on December 31 by the weighted average cost method. 4a. Which inventory method would be preforred for income tax purposes in periods of rising prices