LIFO was designed to protect cash flow in industries where prices increase rapidly. It has been used for both tax and financial statement reporting since the 1930s. The higher cost of goods sold under LIFO in these circumstances results in lower reported profit than under FIFO. In the 2012 budget, President Obama has threatened to repeal LIFO. If Exxon uses FIFO for its inventory valuation, calculate the cost of ending inventory and cost of goods sold if ending inventory is 100 barrels of crude oil: Beginning inventory and purchases Barrels Barrel cost Total cost January 1 120 $ 94 $ 11,280 March 1 45 103 4,635 June 1 60 97 5,820 September 1 70 92 6,440 December 1 45 102 4,590 340 $ 32,765 What is the: Cost of ending inventory:? Cost of goods sold