Daniel Company uses a periodic inventory system. Data for the current year: beginning merchandise inventory $($ending

inventory December $31,$ prior year$),2,120$ units at $$37$; purchases, $7,840$ units at $$39$; expenses $($excluding income taxes$),$

$$193,500$; ending inventory per physical count at December $31,$ current year, $1,780$ units; sales, $8,180$ units; sales price per

unit, $$78$; and average income tax rate, $30$ percent.

Required:

$1-$a$.$ Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods.

$1-$b$.$ Prepare income statements under the FIFO, LIFO, and average cost inventory costing methods.

Between FIFO and LIFO, which method is preferable in terms of $($a$)$ net income and $(b)$ income taxes paid $($cash flow$)?$

Between FIFO and LIFO, which method is preferable in terms of $(a)$ net income and $(b)$ income taxes paid $($cash flow$),$

assuming that prices were falling?

Complete this question by entering your answers in the tabs below.

Req $1$a

Req $1b$

Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods.

Note: Do not round your intermediate calculations. Round your final answers to the nearest whole dollar amount.