E7-9 (Algo) Evaluating the Choice among Three Alternative Inventory Methods Based on Cash Flow Effects LO7-2, 7-3 Following is partial information for the income statement of Audio Solutions Company under three different inventory costing methods, assuming the use of a periodic inventory system: Required: 1. Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods. 2. Prepare an income statement through pretax income for each method. Sales, 344 units; unit sales price, $55; Expenses, $1,610 3. Rank the three methods in order of income taxes paid (favorable cash flow). Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods. (Round intermediate calculations to 2 decimal places. Round your answers to the nearest whole dollar amount.) Cost of goods sold Beginning inventory (398 units @ $27) Purchases (474 units @ $35) Goods available for sale Ending inventory (528 units) Cost of goods sold FIFO LIFO Average Cost $ 10,746 $ 10,746 $ 10,746 16,590 16,590 16,590 Required 1 Required 2 > Required 1 Required 2 Required 3 Prepare an income statement through pretax income for each method. Sales, 344 units; unit sales price, $55; Expenses, $1,610 FIFO LIFO Average Cost < Required 1 Required 3 > Required 1 Required 2 Required 3 Rank the three methods in order of income taxes paid (favorable cash flow). FIFO LIFO Average cost < Required 2 Required 3