E7-11 (Algo) Choosing LIFO versus FIFO When Costs Are Rising and Falling (LO 7-3) Use the following information to complete this exercise: sales, 550 units for $15,900; beginning inventory, 300 units; purchases, 400 units; ending inventory, 150 units; and operating expenses, $4,200. Required: 1. Complete the table for each situation. In Situations A and B (costs rising), assume the following: beginning inventory, 300 units at $14 = $4,200; purchases, 400 units at $16 = $6,400. In Situations C and D (costs falling), assume the opposite; that is, beginning inventory, 300 units at $16 = $4,800; purchases, 400 units at $14 = $5,600. Use periodic inventory procedures. Costs Rising Situation A FIFO Situation B LIFO $ Costs Falling Situation C Situation D FIFO LIFO $ 15,900 $ 15,900 $ 15,900 15,900 $ 4,200 6,400 10,600 2,400 Sales Revenue Beginning Inventory Purchases Goods Available for Sale Ending Inventory Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Income Tax Expense (30%) Net Income 4,200 4,200 4,200 8,200 7,700 4,200 3,500 1,050 2,450 $