Required information

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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			Unit Cost
Inventory, December 31, prior year				2,840			$	14
For the current year:
Purchase, April 11				8,840				15
Purchase, June 1				7,940				20
Sales ($53 each)				10,910
Operating expenses (excluding income tax expense)	$	188,000

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.

LIFO. EMILY COMPANY Income Statement For the Year Ended December 31, current year Case A FIFO $ 578,230 Case B LIFO $ 578,230 Sales revenue Cost of goods sold: Beginning inventory Purchases $ $ 39,760 291,400 39,760 291,400 331,160 Goods available for sale Ending inventory 331,160 218,200 Cost of goods sold Gross profit Operating expenses Pretax income