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Givoly Incorporated uses a periodic inventory system. At the end of the annual accounting period,...

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Accounting

Givoly Incorporated 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 6,200 $ 8
For the current year:
Purchase, March 518,2006
Purchase, September 199,2002
Sale ($26 each)8,600
Sale ($28 each)15,200
Operating expenses (excluding income tax expense) $ 392,000
Required:
Prepare a separate income statement through pretax income that details cost of goods sold for (a) Case A: FIFO and (b) Case B: LIFO.
Compute the difference between the pretax income and the ending inventory amounts for the two cases.
Which inventory costing method may be preferred for income tax purposes?

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