LIFO and FIFO Inventory Costing Methods Review Problem

Listed below is information from Rajan Company regarding the beginning inventory, purchases and sales of one item of inventory for the month of January.

Jan. 1 Beginning Inventory	6 units at $10 each
Jan 8	Sold 2 units for $30 each
Jan. 13	Purchased 10 units at $12 each
Jan 20	Sold 5 units at $30 each

1. Fill in the chart below by computing cost of goods sold for January and the value of inventory reported on the Jan 31 balance sheet. Show the correct amounts for the FIFO and LIFO inventory methods. Be sure to show your calculations and final answer

	LIFO	FIFO
Cost of Goods Sold reported on the January Income Statement
Inventory Value on the Jan 31 Balance sheet

2. Which inventory method would the business owner choose if his primarily objective was to minimize income taxes? State your choice and why?

*Please explain your answers