Choosing a cost flow assumption ( LO 10-4, LO 10-5, LO 10-7, LO 10-9) Princess Retail Stores started doing business on January 1,20X1. The following data reflect its inventory purchases and sales during the year: Table Summary Row 1 is a header and spans columns 2 through 4 . Row 8 is a totals row and contains data only in columns 2 and 4 . Row 9 is a heacer and spans all columns. Row 10 is a header and spans columns 2 through 4. Row 14 is a totals row and contains data only in columns 2 and 4. Required: 1. Compute gross margin and cost of ending inventory using the periodic FIFO cost flow assumption. 2. Compute gross margin and cost of ending inventory using the periodic LIFO cost flow assumption. Compute the dollar amount of the LIFO reserve. Using this additional disclosure, how might an analyst estimate Princess's cost of goods sold under the FIFO method based only on publicly available information? Show supporting calculations. 3. Under historical cost accounting. gross margin is calculated as current output price minus historical input price. For analytical convenience, we can break the gross margin into two components: a. Current cost operating margin = Current output price - Current input price. b. Inventory profits = Current input price - Historical input price. Provide an estimate of the Current cost operating margin for Princess Retail Stores. P10-7 - Choosing a cost flow assumption 14 This spreadsheet consists of: 1) Cost flow template for requirement 1 (beginning line 10) 2) Cost flow template for requirement 2 (beginning line 30) 3) Estimate of the Current cost operating margin for requirement 3 (beginning line 22 Requirement 1: Units in ending inventory = Units purchased - Units sold Ending Inventory under Periodic FIFO \begin{tabular}{l|lll} Purchase Date & Units & Cost/Unit & Total \\ \hline \end{tabular} Requirement 2: Ending Inventory under Periodic LIFO Units Cost/Unit Total Requirement 3