The Acct 201 Co. uses the periodic inventory method and had the following inventory information available:

#Units Unit Cost $ Total Cost $

1/1 Beg. Inventory. 100 3 300

1/20 Purchase 500 4 2,000

7/25 Purchase 100 5 500

10/20 Purchase 300 6 1,800

1,000 4,600

Sales for the year were 650 units for $7,000 in total.

1A:

If your bonus was based on profit, which method would you prefer?

1. FIFO
2. LIFO
3. Weighted Average
4. Either method is fine they yield the same profit

2A:

If you wanted to save income taxes, which method would you prefer?

1. FIFO
2. LIFO
3. Weighted Average
4. Either method is fine they yield the same income or profit.