E7-9 Choosing LIFO versus FIFO When Costs Are Rising and Falling [LO 7-3]

E7-9 Choosing LIFO versus FIFO When Costs Are Rising and Falling [LO 7-3] Use the following information to complete this exercise: sales, 1.150 units for $31,500: beginning inventory. 900 units, purchases. 1.000 units; ending inventory.750 units, and operating expenses. $6,600. Required: 1. Complete the table for each situation. In Situations A and B (costs rising), assume the following: beginning inventory. 900 units at $10 = $9,000: purchases, 1.000 units at $12 - $12.000. In Situations and D (costs falling), assume the opposite that is, beginning inventory. 900 units at $12 - $10,800: purchases. 1.000 units at $10 - $10,000. Use periodic inventory procedures. $ Sales Revenue Beginning Inventory Purchases Goods Available for Sale Costs Rising Situation A Situation B FIFO LIFO $ 31,500 $31.500 9,000 $ 0.000 12,000 12.000 21,000 21,000 9,000 7.500 12,000 13,500 19,500 10.500 6.000 0,000 12.900 3.000 3,870 $ 0.030 Costs Falling Situation C Situation D FIFO LIFO 5 31.500 $31.500 $10.800 $10.800 10.000 1.000 20.800 11.800 7.500 0.000 13.300 2.800 Ending Inventory Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Income Tax Expense (30%) Net Income 0.000 6,600