Givoly Incorporated uses a perlodic 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, March $5$

Purchase, September $19$

Sale $($$$28$ each$)$

Sale $($ $$30$ each$)$

Operating expenses $($excluding income tax expense$)$

Required:

Prepare a separate Income statement through pretax Income that details cost of goods sold for $($a$)$ Case A: FIFO and $($b$)$ Case B:

LIFO.

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

Which inventory costing method may be preferred for income tax purposes?

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Which inventory costing method may be preferred for income tax purposes?

Which inventory costing method may be preferred for income tax purposes?