Lakeside Trading Ltd uses a Periodic Inventory System. The beginning inventory of Item# XP023 and information about purchases and sales made during March are shown below:

Mar.

1 3 8 14 19 22 27 31

Opening Inventory Purchases Sales Purchases Sales Sales Purchases Sales

2 500 1 800 2 200 4 500 3 200 1 900 2 100 900

units units units units units units units units

@ @ @ @

$18.00 19.50 20.00 21.00

Selling price of XP023 is $37.50 per unit (Ignore GST).

Closing inventory on hand at March 31 is 2,700 units.

Operating expenses for the month were $69,500

Required:

1. Using the FIFO method,calculate the cost of March 31 closing inventory and the cost of sales. 2. Prepare an income statement for Lakeside Trading Ltd for March.