HealthFirst Corp. uses a periodic inventory system. It entered into the following transactions for December.

Date	Activities	Units Acquired at Cost	Units Sold at Retail
Dec. 1	Beginning inventory	300 units @ $75 per unit
Dec. 5	Purchase	600 units @ $80 per unit
Dec. 10	Sales		500 units @ $120 per unit
Dec. 15	Purchase	400 units @ $85 per unit
Dec. 22	Purchase	300 units @ $90 per unit
Dec. 29	Sales		400 units @ $130 per unit

For specific identification, the December 10 sale consisted of 200 units from beginning inventory and 300 units from the December 5 purchase; the December 29 sale consisted of 200 units from the December 15 purchase and 200 units from the December 22 purchase.

Required:

1. Compute the ending inventory value using specific identification and FIFO methods.
2. Calculate the gross profit using the LIFO method.
3. Evaluate the effect of the inventory costing method on the net income and tax liability of HealthFirst Corp.
4. Recommend an inventory costing method based on industry standards and justify your recommendation.