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:

			Units			Unit Cost
Inventory, December 31, prior year				2,890			$	12
For the current year:
Purchase, April 11				8,860				13
Purchase, June 1				7,930				18
Sales ($55 each)				10,860
Operating expenses (excluding income tax expense)	$	191,500

2. Compute the difference between the pretax income and the ending inventory amount for the two cases.

	Comparison of Amounts
	Case A	Case B
	FIFO	LIFO	Difference
Pretax income
Ending inventory