E$7-8($Static$)$ Analyzing and Interpreting the Financial Statement Effects of Periodic FIFO, LIFO, and

Weighted Average Cost $[$LO $7-3]$

Orion Iron Corporation tracks the number of units purchased and sold throughout each year but applies its inventory costing method

at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at

the end of the annual accounting period, December $31.$

Required:

Calculate the number and cost of goods available for sale.

Calculate the number of units in ending inventory.

Compute the cost of ending inventory and cost of goods sold under $($a$)$ FIFO, $($b$)$ LIFO, and $($c$)$ weighted average cost.

Prepare an income statement that shows under the FIFO method, LIFO method and weighted average method.

Which inventory costing method minimizes income taxes?