Required information E7-7 (Algo) Analyzing and Interpreting the Financial Statement Effects of LIFO and FIFO LO7-2,7-3 (The following information applies to the questions displayed below.) Emily Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 2: Units 2,950 Unit Cost $ 13 Inventory, December 31, prior year For the current year: Purchase, April 11 Purchase, June 1 Sales ($52 each) Operating expenses (excluding income tax expense) 8,930 7,840 10,810 14 19 $193,500 E7-7 Part 1 Required: 1. Prepare a separate income statement through pretax income that details cost of goods sold for (a) Case A: FIFO and (b) Case B: LIFO. Answer is not complete. EMILY COMPANY Income Statement For the Year Ended December 31, current year Case A Case B FIFO LIFO s 562,120 S 562,120 Sales revenue Cost of goods sold: Beginning inventory Purchases S S 38,350 273,980 38,350 273,980 312,330 312,330 Goods available for sale Ending inventory Cost of goods sold Gross profit Operating expenses