P$7-3($Algo$)$ Evaluating Four Alternative Inventory Methods Based on Income and Cash Flow LO$7-2,7-3$

Skip to question

$[$The following information applies to the questions displayed below.$]$

At the end of January of the current year, the records of Donner Company showed the following for a particular item that sold at $$16\mathrm{.}80$ per unit:

Transactions Units Amount

Inventory, January $1690$ $ $3,105$

Purchase, January $126604,290$

Purchase, January $262201,870$

Sale $(550)$

Sale $(200)$

P$7-3$ Part $3$

$3.$ Between FIFO or LIFO, which method would result in the lower income tax expense? Assume a $30$ percent average tax rate. $($Round your answer to $2$ decimal places.$)$

Method?

Tax Saving?

Thank you