Exercise 5-5 (Algo) Effect of inventory cost flow on ending inventory balance and gross margin LO 5-1

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The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations:

January 20	Purchased 410 units @ $12 =	$ 4,920
April 21	Purchased 130 units @ $13 =	1,690
July 25	Purchased 230 units @ $14 =	3,220
September 19	Purchased 80 units @ $15 =	1,200

During the year, The Shirt Shop sold 680 T-shirts for $20 each.

Exercise 5-5 (Algo) Part b

b. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.