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 110 barrels of crude oil: Beginning inventory and purchases January 1 March 1 June 1 September 1 December 1 Barrels Barrel cost Total cost 129 $ 96 $12,384 54 102 5,508 69 99 6,831 79 91 7,189 541 104 5,616 385 $37,528 Cost of ending inventory Cost of goods sold $