Lunar Company uses a perpetual inventory system. The companys accounting records provided the following information for Product 2:

Transactions		Units			Unit Cost
a.	Inventory, December 31, 2016		3,300		$	12
For the year 2017:
b.	Purchase, April 11		9,300			10
c.	Sale, May 1 ($30 each)		5,300
d.	Purchase, June 1		8,300			13
e.	Sale, July 3 ($30 each)		6,300
f.	Operating expenses (excluding income tax expense), $85,300

Required:
1.	Prepare a statement of earnings for 2017, through pretax earnings, showing the detailed computation of cost of sales for two cases:
	a. Case AFIFO
	b. Case BWeighted average (Round intermediate calculations to 2 decimal place.)

2. Calculate the pretax earnings and the ending inventory amounts between the two cases. Comparison of Amounts Case A Case B FIFO Weighted Average Pretax earnings Difference Ending Inventory Difference 3. Which inventory costing method may be preferred for income tax purposes? OFIFO Weighted Average 4. Prepare journal entries to record transactions (b) through (e), as well as the cost of sales at December 31, 2017, assuming that Lunar uses FIFO for inventory costing. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) Answer is not complete. No Transaction General Journal Debit Credit