Use the following information to complete this exercise: sales, 650 units for $23,100; beginning inventory, 400 units; purchases, 500 units; ending inventory, 250 units; and operating expenses, $4,400.

Required:

1.

Complete the table for each situation. In Situations A and B (costs rising), assume the following: beginning inventory, 400 units at $16 = $6,400; purchases, 500 units at $18 = $9,000. In Situations C and D (costs falling), assume the opposite; that is, beginning inventory, 400 units at $18 = $7,200; purchases, 500 units at $16 = $8,000. Use periodic inventory procedures.

	Costs Rising					Costs Falling
	Situation A		Situation B			Situation C		Situation D
	FIFO		LIFO			FIFO		LIFO
Sales Revenue		$23,100		$23,100			$23,100		$23,100
Beginning Inventory	$6,400
Purchases	9,000
Goods Available for Sale	15,400
Ending Inventory	4,500
Cost of Goods Sold		10,900
Gross Profit		12,200
Operating Expenses		4,400		4,400			4,400		4,400
Income from Operations		7,800
Income Tax Expense (30%)		2,340
Net Income		$5,460