Applying and Analyzing Inventory Costing Methods At the beginning of the current period, Chen carried 1,000 units of its product with a unit cost of $32. A summary of purchases during the current period follows. Units Unit Cost Cost Beginning Inventory 1,000 $32 $32,000 Purchase #1 1,800 34 61,200 Purchase #2 800 38 30,400 Purchase #3 1,200 41 49,200 During the current period, Chen sold 2,800 units. (a) Assume that Chen uses the first-in, first-out method. Compute both cost of good sold for the current period and the ending inventory balance. Use the financial statement effects template to record cost of goods sold for the period. Ending inventory balance $ 0 Cost of goods sold $ 0 Use negative signs with answers, when appropriate. Balance Sheet Income Statement + Noncash Assets 0 Transaction Record FIFO cost of goods sold + Cash Asset + 0 Contributed Capital 0 Revenue Liabilities 0 Earned Capital 0 Expenses 0 Net Income 0 0 (b) Assume that Chen uses the last-in, first-out method. Compute both cost of good sold for the current period and the ending inventory balance. Ending inventory balance $ 0 Cost of goods sold $ 0 (C) Assume that Chen uses the average cost method. Compute both cost of good sold for the current period and the ending inventory balance. Ending inventory balance $ 0 Cost of goods sold $ 0 (d) Which of these three inventory costing methods would you choose to: 1. Reflect what is probably the physical flow of goods? OLIFO OFIFO OAverage Cost 2. Minimize income taxes for the period? OLIFO OFIFO O Average Cost 3. Report the largest amount of income for the period? OLIFO OFIFO OAverage Cost