[The following information applies to the questions displayed below.] Income is to be evaluated under four different situations as follows:

a. Prices are rising:

(1) Situation A: FIFO is used.

(2) Situation B: LIFO is used.

b. Prices are falling:

(1) Situation C: FIFO is used.

(2) Situation D: LIFO is used.

The basic data common to all four situations are: sales, 502 units for $15,060; beginning inventory, 292 units; purchases, 398 units; ending inventory, 188 units; and operating expenses, $3,300. The income tax rate is 35%.

Required:

1. Complete the following tabulation for each situation in Situations A and B (prices rising), assume the following: beginning inventory, 292 units at $10 = $2,920; purchases, 398 units at $11 = $4,378. In Situations C and D (prices falling), assume the opposite; that is, beginning inventory, 292 units at $11 = $3,212; purchases, 398 units at $10 = $3,980.Use periodic inventory procedures.(Round your answers to nearest dollar amount.)

2. Complete the following sentences:

3. Complete the following sentence:

The relative effects on the cash position for each situation.

PRICES RISING PRICES FALLING Situation A Situation B Situation C Situation D FIFO LIFO FIFO LIFO 15,060 $ 15,060 $ 15,060 $ 15,060 Sales revenue Cost of goods sold Beginning inventory Purchases Goods available for sale Ending inventory Cost of goods sold Gross profit Expenses Pretax income Income tax expense Net income 2,920 4,378 7,298 2,068 5,230 9,830 3,300 6,530 2,286 4,245 3,300 3,300 3,300