Emily Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 2: Inventory, December 31, prior year For the current year: Purchase, April 11 Purchase, June 1 Units 2,850 Unit Cost $ 11 8,820 12 7,840 17 Sales ($53 each) 10,960 Operating expenses (excluding income tax expense) $ 191,500 Required: 1. Prepare a separate income statement through pretax income that details cost of goods sold for (a) Case A: FIFO and (b) Case B: LIFO. 2. Compute the difference between the pretax income and the ending inventory amount for the two cases. 3. Which inventory costing method may be preferred for income tax purposes? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a separate income statement through pretax income that details cost of goods sold for (a) Case A: FIFO and (b) Case B: LIFO. Sales revenue EMILY COMPANY Income Statement For the Year Ended December 31, current year Case A FIFO $ 580,880 Cost of goods sold: Beginning inventory $ 31,350 Purchases 239,120 Goods available for sale 270,470 Ending inventory 143,220 Cost of goods sold Gross profit Operating expenses Pretax income 127,250 x 453,630 X 191,500 Case B LIFO $ 580,880 $ 31,350 239,120 270,470 111,150 159,320 421,560 X 191,500 $ 262,130 X $ 230,060