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The Shirt Shop had the following transactions for T-shirts for 2016, its first year of operations: Jan. 20 Purchased 400 units @ $8 = $

The Shirt Shop had the following transactions for T-shirts for 2016, its first year of operations:

Jan. 20 Purchased 400 units @ $8 = $ 3,200
Apr. 21 Purchased 200 units @ $10 = 2,000
July 25 Purchased 280 units @ $13 = 3,640
Sept. 19 Purchased 90 units @ $20 = 1,800

During the year, The Shirt Shop sold 810 T-shirts for $20 each.

c. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.

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