Required information E7-11 (Algo) Evaluating the Choice among Three Alternative Inventory Methods Based on Income and Cash Flow Effects LO7-2, 7-3 [The following information applies to the questions displayed below.] Daniel Company uses a periodic inventory system. Data for the current year: beginning merchandise inventory (ending inventory December 31, prior year), 2,010 units at $35; purchases, 7,950 units at $37; expenses (excluding income taxes), $194,400; ending inventory per physical count at December 31, current year, 1,680 units; sales, 8,280 units; sales price per unit, $75; and average income tax rate, 30 percent. E7-11 Part 1 Required: 1-a. Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods. 1-b. Prepare income statements under the FIFO, LIFO, and average cost inventory costing methods. Req 1A Reg 1B Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods. (Do not round your intermediate calculations. Round your final answers to the nearest whole dollar amount.) Inventory Costing Method Cost of Goods Sold Units FIFO LIFO Average Cost 2,010 $ 70,350 $ 76,000 X Beginning inventory Purchases 7,950 278,250 348,600 70,350 $ 278,250 348,600 58,800 X 289,800 X $ 320,000 396,000 Goods available for sale 9,960 1,680 8,280 Ending inventory Cost of goods sold 58,800 289,800 X $ 58,800 28,900 Req 1A Req 1B Prepare income statements under the FIFO, LIFO, and average cost inventory costing methods. (Do not round your intermediate calculations. Round your final answers to the nearest whole dollar amount.) Income Statement FIFO LIFO Average Cost Sales revenue 6,210,000 Cost of goods sold Inventory Gross profit x $ 6,210,000 X $ 6,210,000 286,440 X 289,800 X 334,560 X 331,200 X 194,400 x 194,400 140,160 X 136,800 X 43,048 X 41,040 X 98,112 X 95,760 289,800 X 289,800 X 194,400 X 136,800 X 41,040 X Income tax expense Income tax expense Pretax income 95,760